As one of the most popular markets in the world, property investment in the UK remains a clear opportunity to build long-term returns in 2022. With property forecasts suggesting the UK could see prices grow by 21.5% by 2025, UK investing remains a reliable channel for maximising returns amidst low interest rates and incredible demand.

Driven by rising demand for rental property in the UK, long-term forecasts for rental prices remain very positive for those looking to invest in the UK.

The market remains buoyant despite external pressures, and capital appreciation continues to boom, meaning landlords can feel positive about good capital gains if they ever come to sell further down the line.

In the here and now, the fact that demand is comfortably outstripping supply means that landlords can set competitive rents and improve their margins.

Here, we set out what landlords need to consider before investing in their next property.

The best ROI

When it comes to investing in a home, return on investment is a crucial factor – perhaps the crucial factor. A number of things determine this, some of which are hard to control, but there are certain golden rules you can follow to improve your chances of good ROI.

Choosing the right location – one with good local schools, amenities, restaurants, pubs, bars and green space – should make your home appealing to future tenants and improve your home’s sell-on value should you ever come to sell it. Homes close to universities are also always in hot demand if you want to consider investing in the student market, but of course letting to students can come with greater risks.

A local area with a strong sense of community or major regeneration projects taking place, bringing new investment and people in, are also likely to increase your chance of charging higher rents, generating a better ROI and boosting the capital gains on your property.

Get to know the local market

To ensure you get the most from your rental properties, it’s important that you get to grips with the local market before investing there. What is the average local market rent? Where does most of the rental demand come from? Is it young professionals, students, older renters?

Working closely with an experienced, local letting agent – one with boots on the ground knowledge – will help to make sure you invest wisely.

It’s never good to target one specific demographic for your rental properties, but equally if an area has an over-concentration of a certain type of tenant, it’s good to try and tailor your home towards them. This might be the provision of work from home space for work from home tenants or garden space/parking for family tenants. 

Assess the area

Chat to locals in the neighbourhood about the area and see if they have any insights that might be helpful about the property and the area itself. Spend some time in the surrounding area, separate from the viewing, so you can familiarise yourself with the locality.

When it comes to the day of the viewing, the excitement of the viewing often results in key elements not being discussed, therefore it’s advised that you write down a list of questions beforehand and take them with you.

Lastly, do your due diligence and research beforehand to ensure you are not purchasing a property with structural issues, or any concerns surrounding damp and subsidence. And keep some money back just in case you have to deal with any unexpected void periods – unlikely in the current market, but still something to be aware of.

Growing your portfolio isn’t something you should do lightly, but the current environment is working in favour of landlords, and now could be a great time to act to get tenants into your new properties just as the summer arrives.

Here at Key Property Consultants, we are an experienced and reputable estate agent based in Suffolk and can assist you with all aspects of the letting journey. For more information on our services, please contact us today.

To find out how much your home could be worth if you were ever looking to sell your rental property, we also offer a free and instant online valuation.

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