Survey Shows UK Public Think
Property Investment Provides Best Returns
A new survey has discovered that 40% of UK residents would rather choose property investment over all other investment types.
The YouGov survey commissioned by InterTrader found that 40% of UK residents reckon that property investment is the best vehicle for generating a good Return On Investment (ROI).
In addition, over half of UK residents would consider a more active role in managing their own investment opportunities, with 38% of respondents saying they would not trust financial professionals to generate high enough positive returns with their hard earned savings.
The findings of the YouGov survey were published amid the concern that parts of the UK, especially London and the South East, are experiencing a localised and unsustainable property bubble.The UK government’s Help to Buy scheme has come under heavy criticism from many financial institutions and independent economists for fuelling the current property boom being observed in London and the South East and misleading the majority of property buyers nationally, by not openly disclosing that the Government will own a stake in the purchased property until the loan agreement or guaranteed mortgage had been satisfied.
The Government are also giving the public the impression that they will be providing ongoing lending support to willing property buyers for years to come, using the Help to Buy scheme, although there are rumours that the Government plans to withdraw the scheme earlier than originally planned.
In spite of these fears, the YouGov survey revealed that 30% of the UK public, who responded, think property investment in the UK will be even more popular by 2019, especially with the amount of foreign investors currently trying to snap up property bargains amid rising prices in the nation’s capital.
Steve Ruffley, chief market strategist at InterTrader, who commissioned the survey, said: “The UK housing market boom, especially in London and the South East, is completely unsustainable. By artificially stimulating demand for property in a supply constrained market, it will actually become even more difficult for the next wave of property buyers to get a foothold on the housing ladder, as persistently low interest rates from the Bank of England and rising consumer confidence cause house prices to soar. Additionally, banks are now increasing the availability of riskier mortgages to compete with the Government’s Help to Buy scheme, reporting a surge in the availability of mortgages requiring lower deposits last year. Britons need to take control of their investments. It has been bred into the UK population that property is the best investment. In fact, a wiser investment strategy might be to build out a diversified portfolio that could protect you in case any one of your investments loses value. Investors can’t wait around and cross their fingers that property prices will keep on rising. Active investments in shares, bonds, and even currencies and commodities offer one of many alternatives and can be simpler than you think. Using an investment strategy that spreads risk means that your lifesavings might not be decimated in one swoop.”
Personally, I prefer the stability of bricks and mortar, whilst there may be capital appreciation down the line, there is the rental yield that can be generated from the investment property from the start of a tenancy, that should cover the buy to let mortgage payments, buildings insurance and operating costs as well as generating a small but realistic monthly profit.
Diversifying investment strategies is sound advice, but investors should always do their own due diligence into whatever investment vehicle that they choose to pursue, in order to be well informed about the risks as well as the potential returns on offer. Often the claims made by some investment brokers can be a little ambiguous and details can be misleading and would be investors should only proceed if they are personally happy with the risk.
Remember though, if a deal appears to good to be true, due diligence will show that it often isn’t!
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