UK property investment | Five tips to avoid risks

With the promulgation of my country's real estate "purchase restriction order", more and more investors are rushing to invest in overseas real estate markets. The British real estate market is deeply loved by investors. So how to avoid high risks and obtain higher returns in the UK real estate process? We summarizes the following five points for your reference, let's take a look:

 

1. The right intention

Smart investors know very well: debt is a powerful tool to help them raise debt and strengthen their asset base. If it can be operated correctly, debt is not a bad thing. However, they are generally not overly indebted. That is, their cash flow is never affected if they run into financial distress. If something unexpected happens in their life, they don't need to sell their property to bail them out. They always pre-establish risk prevention strategies, such as insurance (income insurance, life insurance, title insurance). They have buffer accounts with banks to guarantee cash flow. They treat real estate as a business. rather than passive.

 

2. Get information in a timely manner

Successful investors often enrich their knowledge by attending seminars and reading real estate publications and real estate websites. They try to follow the real estate situation. That is to say, they are eager for efficient real estate information to give them a more competitive advantage. Once there is a suitable real estate opportunity, they will successfully hunt for it. Having better information allows them to make their next decision faster and more accurately.

 

3. Hire a professional

All successful ones hire professionals to do it. Like a company run through a board of directors, they employ professionals in various fields for guidance and advice. As they are very clear: accountants and financial advisors can help with paying taxes and setting up asset frameworks. For example, in whose name is the property purchased? What is the expected budget and cash flow?

By establishing a good relationship with financial or bank brokers, they can obtain financial items to purchase real estate, or they can draw out the same amount of funds stably when necessary.

They develop relationships with real estate buying agents to help them buy the right property in the right area at the right price without being misled by emotions.

They hire real estate agents to handle property leasing and management.

They use lawyers to carry out property handover and estate planning matters when necessary.

They discuss all aspects of capital insurance with insurance brokers, especially cash flow insurance.

 

4. Have a clear awareness of liabilities and the concept of market time

Successful property investors know that in order to grow their equity base they must borrow money and manage cash flow (leveraging). But they don't put themselves under undue stress and always have a buffer ready for emergencies.

They know that buying property is long-term and cyclical. They don't panic when the housing market changes. If the right property is chosen, they know that time will heal and property values will grow in the long run. They believe that real estate is not only, but also real estate appreciation (intangible appreciation, not just an increase in bank deposits). This helps them focus on the long-term, rather than selling properties due to downsizing, short-term vacancy or slow market appreciation. Timing is an important factor when choosing the right property. In other words, if you can occupy the real estate market for a longer time, you can reduce the risk, because the property value will increase. In addition, if they buy inferior real estate, they will quickly find out and sell it quickly to reduce losses.

 

5. Understand the real estate market where the population lives

A smart investor will know the population living market before buying a property to ensure the right area. They aim at the provincial capital, urban areas and even streets that may appreciate, and investigate the urban, suburban and street population statistics in advance. They hire professional real estate buying agents to do site inspections, and these people have all the data, including property appreciation trends in the area, over-development areas, vacancy rates, and potential prospects. Successful people proceed rationally, with simple and single-minded goals, only for capital appreciation and investment.