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Property investment: Why good advice is essential

Updated: Mar 23, 2021

The difference between a good property investment and the best possible will be worth thousands of pounds, potentially even in the first year. There are a few reasons for this:


Prices drive returns - if all other things are equal, buying at the right price is the fastest way to improve your investment performance. If you know the genuine market value for an area - on a £/sq ft basis, you can quickly decide whether to buy property that has come onto the market. Even better, you can inform an agent to alert you when a suitable property becomes available.


Earlier rents - the best properties rent first to a given target buyer. This might be in terms of particular features such as the property layout, or a particular orientation vs the sun (south-facing gardens are very popular in the UK!) This also applies to any future subsequent renters, which reduces void periods. 


Higher rents - the difference in cash income between renting for at a 6% yield vs a 7% yield on a £200,000 property is £20,000 over 10 year period (this is based on £1,000 vs £1,167/month in case you were wondering).


Faster and higher sales prices - if selling to another investor, the properties with the strongest rental history are worth more. 

You might be asking, "so why do I need actual advice, especially when there is so much information available on the web?". This is very true, and it's a marvel that so much research can be done on both the general property market, and individual properties, from the comfort of our own homes. However, the property market is unlike other markets in which we might invest. Very few properties are identical, and returns can vary significantly, from property to property, and between similar properties in nearby streets.


Add to that your investment strategy: you might want to generate regular cashflow, while a friend or relative might be looking for long-term growth to supplement their pension. Someone else will be seeking a bargain that they can sell in a couple of years, while their cousin is hoping to refurbish and rent out to young, well-paid professionals. Each of these require very different strategies, meaning that a good investment opportunity for one (the first person might want a BRR* property for example) will not be appropriate for the rest.


Then of course you have the opportunities. No doubt you've browsed the web and seen that there are thousands of properties for sale, even in a single city. In addition, there are many companies proposing new-build developments, with their beautiful marketing brochures and plush specifications. What do you go for: studio or 1-bedroom? House or apartment? New-build or previously owned? Big city or commuter town? Does a £20,000 discount make this a good deal or not? The choices are seemingly endless.


The best way to navigate this is to seek unbiased advice from an expert. If that expert has the same incentives as you, that is, to help you make the best decision for you and your strategy, then you're off to a good start.


Here at BellPepper, we don't sell properties. What we do is buy lots of data (we have over a billion datapoints), and research the UK market in great depth. This puts us in the great position of being able to advise on any potential transaction, and give you advice that is personal to you. While we think that property is a great investment class, we want to help you make the best possible choice amid all the complexity. Making your investment decisions easier and faster is at the heart of what we do.


And once you have one or several properties, we want to be with you every step of the way, helping you both monitor your investment, and make the right choices to optimise your returns.


So we welcome you to BellPepper. We will be updating the blog regularly with interesting, educational and thought-provoking content. Feel free to register, or get in touch at any time.




 

*BRR means Buy-Refurbish-Rent, a common strategy to add value to a property, increasing potential rental value and reducing void periods.

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