Friday 7 July 2023

Interest rate hikes could mean opportunity for South London Property Investors

Everyone is selling up - but should they?

The Bank of England's latest interest rate hike is likely to lead to more landlords selling their properties, but it could also create opportunities for investors. A survey by Finbri found that 45% of landlords would sell their investment properties if the base rate reached 5%. With the rate now at 5%, it's likely that even more landlords will exit the market. This could create a shortage of rental properties, which could drive up rents. This would benefit investors who are looking to buy properties to rent out. In addition, the number of properties available to rent has fallen by a third in the past 18 months. This means that there is already a high demand for rental properties, and the shortage is likely to make it even harder for renters to find a place to live.

This can can create opportunities for investors who are willing to do their research and take on some risk. Or keep taking on risk and hold on to their investments.

Property will remain profitable

Some property commentators predict that house prices will fall in 2023. However, even if this happens, property will still be a profitable investment. This is because property investors will still receive rent, and they may also be able to claim (some) tax breaks. In addition, the UK population is still growing rapidly. This means that there is a growing demand for rental properties, even if the supply of rental properties decreases.

The rental market

The rental market is expected to remain strong in 2023. This is because the supply of rental properties is still short of demand. In addition, the pandemic-induced tenant eviction bans have led to many landlords leaving the market. As a result, rental prices are expected to continue to rise in 2023. However, the rate of price growth will vary by region. London and the Southeast are expected to see the lowest growth, while the regions are expected to see the highest growth. But what other investments can a South London investor turn to? 2022 was a poor year for global stock markets. This was due to a combination of factors, including high inflation, the ongoing war in Ukraine, and poor global growth prospects. While some may argue that stock markets can give good returns over time, I believe that the risk of losing money is too high. In addition, stock markets do not provide physical assets such as property.

The key to a successful investment portfolio

The key to a successful investment portfolio is being well-informed and following a solid strategy. This includes understanding the risks involved in different types of investments and diversifying your portfolio to reduce your risk. It is also important to remember that investments can go down as well as up. Therefore, it is important to have a long-term investment horizon and not to panic sell if the market experiences a downturn.

If you are looking to exit the market, stay in the market, or expand in this market get in touch and let's talk investments. Not relet your property for a while? Why not check out my nifty online valuation tool to see what your property is worth at the moment?

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