Investing in property has become more and more popular over the course of the last few years, with a growing number of buyers now looking to get their hands on tangible assets that can become something of a pension fund.
Property returns now outpace the sort of ROI that can be seen from stocks, gold, annuities and a number of other traditional assets that people would have used for making money for their future, so it makes sense to get into this market now. But where are the best places to spend if you’re looking at buying your first investment property in 2016?
Student accommodation has remained the strongest asset the UK property market has to offer, and with student numbers in 2016’s academic year likely to be strong once more, pushing demand higher still, it really is the time to get into one of the most lucrative and exciting asset classes.
With returns of between six and eight per cent regular occurrences in the student market, investment next year may even outpace the near £6 billion spent this year. But don’t let the large investors put you off. The money spent is simply an indicator of where the real money is at the moment, and with the number of applicants still climbing each year, there’s still plenty to go around.
From the most exciting and fastest growing asset class to the most reliable. There’s never been a better time to invest in rental homes, because the demand from tenants is soaring, fewer people are now buying their own property (the figure has now dropped below 65 per cent) and rental prices continue to climb thanks to a shortage in homes.
Those who buy rental homes now can expect to see solid yields, and with Rics predicting a rise of 25 per cent in property prices over the next five years, there’s a real sense that now is the time to get a slice of the pie before prices really take off, netting new investors really good returns.
And finally, one for the future. Care homes may not have the glitz and glamour of other asset classes, but they certainly have the potential. With government cuts in subsidies to companies that run public care homes, the likes of Southern Cross have announced they will need to close homes in the future. In total, some 1,200 are set to close.
This, of course, leaves a gap in the market, and with older people now looking for new, high quality care homes to live in, there’s never been a better time to get on board with the new age of investment in care homes.