Why is Now the Time to Invest in Property?

Are you looking for a get-rich-quick scheme? Then sadly property investment isn’t for you. However, it may be, if you aren’t afraid of a little hard work, and are looking for a long-term investment.

In the past, investing in bricks and mortar was seen as a safe investment- prices could only go up. But when the recession hit, property prices fell drastically leaving many out of pocket. As the economy recovers, why is now the time to invest in property?

Residential property

Property prices are on the rise again according to a study by Halifax bank. House prices are rising by 6.9% annually and the total number of sales has risen to 172,000. The future looks bright for investment property buyers.

Estate agents, Savills, have gone as far as suggesting that over the next five years, property prices will rise 25%, but are we aiming for another property boom and bust?

Property buying signs are positive. Sellers are achieving high percentages of their asking prices and with the government’s new Help to Buy scheme, more first-time buyers are getting in on the property market action. However, prices in Wales have dropped by 1.7% and prices have not quite reached the record highs of 2007. We’re not in for another boom. Well not for a while at least.

Help to Buy scheme

Unless you’ve been living under a rock for the past few months then you have probably heard about the government’s new Help to Buy scheme. These Help to Buy equity loans give mortgage guarantees enabling successful applicants to buy a home worth up to £600,000 with only a 5% deposit. The government will guarantee 15% of the mortgage.

This property scheme aims at getting young first-time buyers into the property market which they previously would not have been able to afford. If successful, an applicant will not have to pay loan fees for 5 years but in the 6^th year there is a charge of 1.75% of the loan’s value and this fee will increase every year. These fees do not count towards paying back the equity loan.

To apply for a Help to Buy equity loan you must contact a Help to Buy agent in your local area and buy a property from a registered Help to Buy builder.

Commercial property

Is now the time to invest in commercial property? Well, the answer is complicated – yes and no.  This depends on the type of commercial property.

It’s no secret that high streets have been struggling recently, and, as a result, properties are cheap to pick up. This may sound like good news from an investment point of view however this downturn also means you cannot ask for high rental fees and your profits will be minimal.

Small industrial units however are doing well. These are highly sought after and create good returns so if you’re going to invest in commercial property these are a relatively safe bet right now.

Offices are not the best investment at the moment unless you are going to use them yourself. Offices come in large lots or on business parks and require a lot of cash to buy in a rather flat market. However, if you are looking for business needs then office space is abundant in most cities at the moment.

If you are looking to do something different with your business finance or you’re seeking new investment opportunities, then the best time to buy commercial property would have been in the credit crunch as prime locations opened up. However, as the economy recovers there are plenty of bargains still to be had.

So do you think this is the time to invest in property? We do. It’s time to get in on the action now before prices skyrocket once more.