In London, the real estate sector represents 14.1% of the Gross Domestic Product (GDP), being the second economic force in the country, according to figures from the International Federation of Real Estate for the UK.
In accordance with the above, the London association of real estate professionals estimated a 6% growth in the real estate industry during 2019. The best time to invest in real estate, the market grew 66% in real estate income. Learn about the main advantages of buying a house to rent with guaranteed rent scheme in London.
What are the Benefits of Investing in Rental Real Estate?
- You get security and financial stability
- You don’t need to be a real estate expert
- You generate greater capital gains and return on investment
- You can pay off the mortgage credit faster
- You acquire additional income when you rent
- You ensure the family future and retirement
- You get security and financial stability
One of the benefits of investing in rental real estate is maintaining an active property, which allows you to achieve economic stability and, in addition, protect your finances in the long term. Likewise, you will receive monthly rent money and you will be generating fixed income in your finances.
When renting a property it is very important to do preventive maintenance every so often so as not to invest excess money in home repairs or cause problems for the tenants. You must make sure that the clauses of the lease are complied with and that no violation arises that damages the property.
You Don’t Need to be a Real Estate Expert
To invest in real estate it is not necessary to be an expert in real estate, the only thing that you should consider is the equity of the house, apartment or land, and have basic knowledge about finances.
- 55% people from 35 to 50 years old.
- 40% millennials under 35 years old.
- 5% people over 50 years old.
If you do not feel prepared to carry out the purchase and sale process on your own, it would be better to consult a real estate agent, who is certified by the London Association of Real Estate Professionals (AMPI).
You Generate Greater Capital Gains and Return on Investment
Another benefit of investing in real estate for rent is that you will generate greater capital gains, return on investment of up to 20% and you will obtain profitability.
Real estate capital gain is the increase in value that a property generates over time, and there are external factors that determine its value such as location, access to public transport, infrastructure and growth of the area.
Ruban Selvanayagam from modern auction specialists Property Solvers comments: “always try and look for investment locations where there are upcoming infrastructure developments, particularly those that boost commutability.”
Likewise, the return on investment is a very important factor when buying a home; it calculates the time it will take to recover the investment and whether or not it is profitable to buy it.
From the capital gain you must establish the monthly rent of the property. While the return on investment will allow you to obtain more attractive and useful investments by raising the final value of the property.
You can Pay off the Mortgage Credit Faster
When investing in real estate, you can use the monthly rent to cover the mortgage payments or the interest on the loan.
In this way, the property will be paying with the extra income generated and not with your salary, in addition, by paying more money you can reduce the term of the mortgage loan.
It is important that you know that it is also possible to rent a house from if you are paying a mortgage, you only have to meet certain requirements.
You Acquire Additional Income when you Rent
Buying a house to rent is earning additional monthly income. It is essential to know that the value of the property will be increasing in the long term, so at the end or renewal of the lease you will be able to increase a percentage of the monthly payment or rental deposit.
You Ensure the Family Future and Retirement
The last of the benefits of investing in real estate is improving your retirement in the future by having the financial freedom to be able to cover expenses during retirement, live comfortably, and even travel. Finally, you will be inheriting your children an estate, permanent income, and economic stability during their growth.
Investing in Real Estate is an Excellent Option to Secure your Future and that of your Family
Are you looking to acquire a property to rent? You can visit dreytons.com, a real estate portal in London to help you with your search.
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