Property buyers, whether owner-occupiers or investors and landlords, are generally advised to play the long game when it comes to property investment. The longer you can hold onto your property before selling, the better. Despite the monthly peaks and troughs that can occur in house prices throughout the year, overall values continue to climb annually.
Property investors who buy now could see average capital gains of around 30.3% if they sell in 10 years.
Selecting the optimum location in which to invest is one of the first things to consider. For many homeowners, buying close to work, family and friends is often a top priority. However, for property investors and landlords, there are a myriad of factors to consider. Rental demand and prices vary across the country, and it is important to prioritise tenant trends and needs. For example, as more people now work from home, properties don’t need workplaces right on the doorstep.
If you are just crunching the figures in terms of capital gains, London is at the top of the list. With current house prices standing at £465,549 in the capital, the data predicts an increase of 33.1% to £619,568 by 2031.
However, investors need to think about yields, too, which tend to be greater in other regions. The north-west, for example, has some of the highest available rental yields in the country. The low price point of the area is what attracts many investors, alongside the competitive yields and strong rental market. Yorkshire, the north-east and the East and West Midlands are other hotspots for property investment, offering low property prices combined with good yields. In terms of potential house price rises, they all offer great prospects as a place to invest (Yorkshire 28.6%, north-east 28.4%, East Midlands 29% and West Midlands 28.9%).