A Quick Guide to Property Investment
With our culture of widespread home-ownership, the British are at the forefront of foreign property investment. Such ventures are fraught with potential problems – bureaucracy, local laws, exchange rates, foreign languages – but the end result can be hugely rewarding and profitable.
Most people buy property that will grow in value over time. There are two ways to do this:
a) Capital Growth - general property price growth in a specific location
b) Rental Income – investing in a property that can guarantee you rental income
As an investor, you will probably fall into one of the following categories. Having an understanding of what kind of investor you are should help you to make the right choices:
Guaranteed Rental Schemes
These schemes guarantee you a period of rental income, usually set at a percentage of the overall cost of the property.
New Developments and Off Plan Investment
Investments can be made while a project is still under construction, or sometimes before planning permission has been granted. The price will reflect the risk.
Buy To Let
Buying a property with the immediate intention of letting it out is a familiar approach with popular resorts, who often provide this kind of scheme as rentals are easy to achieve.
Leasebacks
A leaseback investment involves buying your property and then leasing it back to an on-location property management company for a set period of time. They will agree to pay you an annual yield based on a percentage of the property value. Leasebacks are popular as they reduce the risk inherent in buying overseas.
Low or Nil Deposits
Some developers provide low or no deposits as an incentive for interest in a property. You get a return on your investment buy selling the property on with the deposit restored.
Once you’ve settled on the part of the world you would like to invest in, and the type of investment you want to make, you should be prepared to search the market thoroughly for the right property. Legal & general offer advice on investments, and Fish4.co.uk have an extensive property search service.
For holidays and cheap flights across the world try Travel Zoo and for travel insurance you might like to scout the Go Travel website.
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