Property remains one of the most resilient and stable asset classes, but it’s also a topic on which everyone seems to have an opinion. In fact, there are so many myths it’s virtually impossible for potential investors to sort fact from fiction. In this article, we investigate the 5 most popular property myths.
Myth 1 – “It’s not a good time to invest in property”
Whether a property is a good investment or not depends on hundreds of factors, such as where it’s located, how large it is, how old it is, how much it costs, and how much demand there is in the local area. There will always be opportunities if you know where to look and what to look for. In fact, we think now is a great time to invest in property, thanks to cheap Buy to Let (BTL) mortgages and a growing demand for houses in the Northern property markets. You’ll look back in 10 years’ time and wish you had done it sooner!
Myth 2 – “Investing in property is a big risk”
When investing money, it is impossible to avoid risk. Even if you just put your money in the bank, there is a small chance that the bank will go bust and if nothing else, it’ll end up losing value over time, thanks to inflation. However, it is possible to manage the risk by doing your due diligence and investing wisely.
When we help our clients build a property portfolio, we always pursue a future-proof investment strategy and build-in resilience. This means identifying properties that will benefit from both rental and capital growth and spreading the risk by investing in multiple properties across Leeds. This maximises their chances of success and helps them create long-term wealth and independence .
Myth 3 – “Investing in property involves a lot of time”
Unlike the stock market, people perceive that owning a BTL property involves a lot of work. You have to find a property, do all the due diligence, liaise with lenders and brokers to purchase it, and even then, you might have to refurbish it before dealing with the headache of tenants!
There is definitely a lot of work, but in the modern day you don’t have to do it all yourself. If you use a property investment service, you’ll can get an expert team to help you carry out the whole process on your behalf. They typically use a tried and tested model and carefully chosen partners to ensure your investment is as hands-free as possible, so you just receive a passive monthly income direct to your bank account.
Myth 4 – “You need loads of money to start investing in property”
This myth is prevalent more so among London clients and only really applies to London, where investing in BTL property requires a huge amount of capital. Today, buying, refurbishing and letting a rental property in the North typically costs around £60,000, including all the fees. This makes BTL property much more accessible and many people take advantage of the lower costs by purchase multiple properties, diversifying their investment.
Myth 5 – “You can make money quickly by investing in property”
‘Homes Under the Hammer’ has a lot to answer for with this one, because although it is possible to make money quickly from ‘flipping’ a house, it’s also risky to do if you’re not an expert. There are dozens of traps that can trip up an unwary investor, from cheap houses that aren’t that cheap to problems securing mortgages, which can quickly turn profits into stinging losses. We recommend sticking to strategies that are proven to deliver reliable, long-term returns – both rental and capital. Given the nature of investments, people should always go in with their eyes open and a timeframe of 10 years or longer.
Discover the reality of investing in BTL property
At Lifestyle Property People, we offer a tried and tested service to help London-based professionals invest in high-yielding properties in Leeds. If you want to find out what investing in BTL property is really like, why not take a look at our 5 step investment model.