10 Tips for Successful Property Investment in a Changing Economic Climate

The property market has long been a popular form of wealth creation, even during times of economic uncertainty. 

The reality is that while prices may fluctuate and markets can be unpredictable, the long-term value of property as an asset is undeniable.  With the right approach and up-to-date information, anyone looking to make sound investments in today’s changing economic climate can do so with confidence.

In this blog post, we’ll share 10 essential tips for successful property investment in a changing economy.

 

What is the current economic climate?

In the UK, inflation has increased to 6.2%, which is a 30-year high. It’s being predicted that it could top 8% later this year. 

Living costs, especially, energy, food and fuel prices, are rising at extraordinary rates. This steep rise in inflation and consumer prices has led to a cost-of-living crisis. 

With Russia invading Ukraine, this is expected to keep inflation higher for longer. Some policies that were announced within the Spring Budget were to relieve surging inflation.

However, whilst other assets are negatively affected by inflationary pressure, inflation in the housing market is actually the property investor’s friend, as house values increase as an indirect result of inflation. This increases the investor’s asset value.

10 Tips For Property Investors In The Current Economic Climate

1. Do your homework 

Do extensive research into the local property market before investing in any properties to ensure that you make an informed decision.

2. Consider smaller towns and cities

Look for areas with average values still below national averages for better protection against downturns and potential for growth.

3. Focus on rental yields

Search for properties that offer attractive rental returns as well as capital gains over the long term.

4. Leverage expertise

Use a good investment specialist (such as those available on the Touchstone Education Wealth Academy) to help you develop a bespoke plan based on your individual circumstances and goals, and provide advice and support throughout the process.

5. Monitor the economy regularly

Keep up-to-date with economic changes so that you can adjust your investments accordingly to remain competitive in the market.

6. Take advantage of technology

Use online tools and resources to help you analyse data, identify trends and find properties that meet your criteria quickly and efficiently.

7. Consider different types of investments

Look into a range of opportunities such as student accommodation investments or property development projects, which can often be more profitable than traditional residential property investments.

8. Make sure you’re familiar with regulations

Understand the changes to taxation, regulation, and other government policies affecting landlords so that you can make informed decisions about your investment strategy.

9. Structure your portfolio correctly

Diversify across multiple asset classes to spread risk and maximise returns from both short-term and long-term investments.

10. Be nimble and flexible

Be prepared to act quickly if market conditions shift, such as taking advantage of new opportunities or selling properties that no longer fit your strategy.

What are the next steps for property investors

 Touchstone Education founder Paul Smith said, “Increasing property prices are fairly likely during periods of inflation and the jump in value tends to offset the rise in prices elsewhere in the economy. And because property is a leveraged asset, as long as the interest rate doesn’t change, your payments remain the same as the value of your house increases.

“You can also make money on your deposit. For example, if inflation were to double the value of your property, the value of your down payment has also increased. If yours is a fixed-rate mortgage there’s more good news as you’ll pay back less in real terms than originally stated.

“As there are a lot of factors at play in the current economy, you need to be sure you are up to date with everything that is going on to manage property investment effectively and Touchstone Education’s training and support can help.”.

Wealth Through Property is the UK’s leading 2-day property investment course. It is designed to provide you with specialist knowledge of proven investor 

strategies. Learn how to get started and build your property portfolio and gain real-world advice.

Alternatively, make the first steps on your property journey, claim your free Wealth Through Property e-book.

To find out more information about the property investment courses we offer call us on 01302 897131 or email office@touchstoneeducation.li.