You can ease yourself into the stock market with trading games and small purchases, but getting started in property investment is a more significant undertaking. Fortunately, it is entirely possible for new investors to do well, as many people demonstrate each year. Here are some tips to get you started.
Begin by educating yourself on the practicalities of property investment
As a small investor, when you buy shares in a company, you generally leave the running of the company in the hands of its paid directors. As a small property investor, you are the director of your own company (even if you do not set yourself up as such) and it is therefore your responsibility to ensure that you comply with all legal requirements and fulfil all necessary obligations.
You can only do this if you know what they are and ideally you will want to have at least a basic idea of what the future might bring (for example, the government is currently making signs that this summer may be the time when it finally bans agencies from charging lettings fees to tenants). Of course, you can employ people to help you with the practicalities of being a landlord, but knowing at least the basics yourself, has the potential to be very helpful both when choosing them and when working with them.
Choose your location and niche
While the old joke about “location, location, location” still holds (very) true, it is also important to choose a specific niche. This runs deeper than just commercial property versus residential buy-to-let, it involves deciding exactly who you are targeting, e.g. students, young adult professionals, families, retirees… It might be helpful to choose your niche first as this could influence your choice of location, for example, if you want to market to students then you’re obviously going to need to invest in property in a location which is convenient for at least one university.
Alternatively, if you have set your heart on investing in a particular location (perhaps you’re attracted to the vibrant housing market in the north), then you may want to see what demographics are underserved in your chosen location and target them, more information is available at https://offshorecitizen.net/countries-with-no-income-tax/.
Research the details in depth
When it comes to any sort of investment, details matter and that goes for everything from your initial choice of investment vehicle to the manner in which you manage it. If you are looking for the most “beginner-friendly” route into property investment, then you may want to consider commercial property and, in particular, student accommodation investment, which offers very safe and predictable returns often for a very affordable price when compared to residential buy-to-let and which is always managed by a third-party company, usually arranged by the developer, and thus offers a completely “hands-off” investment.
On the other hand, those seeking the very best returns might want to venture into the standard residential buy-to-let market, or even houses in multiple occupation in search of the very best returns, plus the potential of benefitting from capital gains (or at the very least ending up owning an asset outright).