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Capital gain is not the be all and end all of property investment

L

Longterminvestor

Administrator
For many years now there has been a strong focus on property investment capital gains in the short, medium and long-term. While there is no doubt that banking a quick profit gives you more ammunition for the next deal, sometimes rental yields are ignored. If you are fortunate enough to find a property with a rental yield of say 10% then in theory after 10 years you should have grossed enough rental income to cover the cost of the property.

In reality there will be finance costs, there will be interest and there may even be investment required to keep the property up to standard. However, this does give you an example of how a simple buy to let property investment can literally pay for itself in the longer term. The more equity you have in a property the stronger your position when looking to raise additional capital in the future.
 
N

nmb

Well-Known Member
Sometimes far too much focus is placed upon the ability to crystallise capital gains from your property investments. Why not look at a healthy mix of capital gains and rental income to give your property portfolio some backbone and something to fall back on in more difficult times?
 
L

lookinginvest

Member
This is a common mistake, looking to make short-term profits that make you feel better. If your judgement is correct in the longer term you could crystallise significant gains as well as rental income.
 
P

PostBrexitInvestor

Member
I will be looking for capital appreciation and rental income with my post Brexit investments. Short-term sellers are now bringing property prices down to levels which I believe are extremely attractive in the longer term. What really is going to change with the UK property market as the population grows and housing shortage worsens?
 
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nmb

Well-Known Member
We are already starting to see “clever investors” making use of the large London premium on house prices. More and more London homeowners are becoming aware that they can buy much larger properties outside of London often for less than the cost of their London properties.
 
R

realdeals

Active Member
We have seen this time and time again, negative comment on the London housing market and signs that investors were finally realising there is better value elsewhere. However, time and time again they return to the capital. London is to all intents and purposes a different country within the UK with a very different demographic, economy and working environment.
 
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