Buy-to-let has long since proved its buoyancy, remaining a strong and steady market for over a decade. Since the financial crash of 2008, the investment landscape has changed dramatically—with mortgage lending getting tougher and house prices soaring—but property has remained a constant, proving itself time and again as a tangible and secure investment
Here are 5 reasons why property is still among the best asset classes:
1. Outperforming other mainstream asset classes
Property has been consistently outperforming stocks and shares and other mainstream assets for over 10 years. Because of this, buy-to-let is widely considered the best investment option on the current market, especially in a time when interestrates are at an all-time low (at best averaging 1.5%) and other assets are not as stable or lucrative as once they were.
2. Two-fold investment returns
Property is one of the only asset classes that offers the potential of two different (but incredibly lucrative) returns on investment:
Rental returns: Consistent rental returns provided on a monthly basis to the landlord during the time a tenant is residing in the property.
Capital appreciation: With the property market at peak, the capacity for investors to benefit from selling their property for more than they bought it for is at also at its highest, meaning a financial return for investors when selling their buy-to-let property.
This means that landlords will benefit immensely from returns both during and at the end of a property’s lifecycle.
3. Security offered by bricks and mortar
Bricks and mortar (the colloquial name for property) is one of the most trusted investment types, with investors enamoured with the fact that property is tangible and inelastic. Another massive plus for investors is the fact that bricks and mortar is an asset class that is inheritable, meaning that investors can pass on their property to their children after their death, offering financial security for future generations too.
4. Growing house prices
For years the UK housing market has recorded year-on-year growth in terms of house prices, fuelled by a chronic undersupply of available homes. Therefore, experts predict that the upward trajectory on house prices will continue as long as the supply/demand imbalance across the UK exists.
5. Rising PRS
Likewise, the rental market in the UK is currently skyrocketing because of the same supply/demand imbalance. More people than ever have been priced out of the owner-occupier market, which is why demand is through the roof for prime rental accommodation in popular rental destinations.