Investing is a popular financial pastime, and it isn’t difficult to see why. Not only can it be an exciting project, but it can also offer the opportunity to make a significant profit in the long term. But simply choosing to invest our money is not enough. We also need to decide which avenue we will invest our finances into. For many people, this is a choice between investing in shares and investing in property.
Both of these options have a number of potential benefits, but they also have various factors that you will need to consider before making a final decision. Let’s take a look at both investment options in more detail.
Investment in property has continued to be an extremely popular option in recent years, and many people choose to buy flats or houses in order to rent them out as an investment strategy which will stand them in good stead for years to come.
However, it is safe to say that things have changed for buy-to-let landlords in recent years, so before committing to a property investment you need to get to grips with the state of the market at the time you are looking. As of April 2016, an additional 3 per cent of stamp duty was added onto second home purchases, and as of April 20017 landlords cannot claim full tax relief on mortgage interest payments. This change will continue to be phased in gradually until 2020, when it will be fully implemented.
Because of these changes, studies show that landlords are more likely to decrease their property portfolio over the next twelve months than increase them. However, this can create an opportunity for potential investors, as there will likely be less competition. Experts advise that one of the best ways to manage a property portfolio is to make sure it is diverse.