Ask any successful investor or financial advisor and they’ll tell you the same thing; diversification is key for a dynamic and effective investment portfolio. A successful portfolio is made up of a range of assets, including stocks, bonds and cash as well as tangible assets, like property. Your portfolio should also take into account your personal situation; lifestyle, age and risk profile all affect your investment portfolio.
Why should you diversify?
The answer is simple. By not diversifying, your money is all tied up in one investment. If something happens to that investment you might end up losing a big chunk of your money. In terms of property, it pays to diversify across different property types and locations within your portfolio. Whilst you can’t eliminate risk completely, diversifying in this way will ensure that risk potential is minimised.
What properties make good investments?
This all depends on what you’re looking to achieve from your portfolio. Traditional buy-to-let properties are a great option for those looking for a steady income with minimal involvement, whilst an HMO opportunity should be grabbed by any investor looking to be more hands-on in the development and maintenance of their property. Commercial property can provide longer term tenants with the need for day-to-day management almost non-existent. Depending on individual requirements, any type of property can provide a valuable and lucrative investment option when managed correctly.
Why is property a great investment?
2016 has been a rollercoaster of uncertainty within the political and financial worlds, as well as in the property sector. In uncertain and unstable times like these, investors often look to equities such as gold and gilts, and these do often perform well. However, these fail to provide the long-term, stable investment option that so many investors are looking for. This stability is exactly what property investments can provide, both in the long-term, with capital growth, and the short-term, with rental incomes. As we’ve said already, property investments do not eliminate risk, but as an integrated part of an investment portfolio, property can provide a solid and stable basis for continuous growth and long-term success.
If you would like to talk to our friendly, professional team of property experts about what properties are suitable for you, or are looking for sound investment advice, please don’t hesitate to get in touch.