Investment diversification with real estate
Smart investors know that the key to a well-rounded portfolio is investment diversification. But some forget that real estate can be an important element of that. In general, property prices continually rise and are less susceptible to price fluctuations like stocks and currencies. If property is purchased on a buy-to-let basis, your investment can also provide you with a steady income stream. These returns can often be used to balance out other investments more vulnerable to market movements.
Purchasing property on buy-to-let terms has been a very popular method of investment diversification. Landlords can command a regular income from a range of properties including apartments, houses and HMOs. Financed correctly, these properties can often pay for themselves via the rental income and could provide a profit on top. Property owners can either maintain properties with a hands-on approach or chose to have them professionally managed.
Recent research related to the buy-to-let sector has shown that the rental market is currently buoyant. One of the reasons for this is not wanting to take a financial commitment. But this factor provides property investors with an ideal opportunity to capitalise on this trend. Buy-to-let mortgages recently saw a fall in numbers in a report from the Bank of England. This came after the sector had previously seen two months of growth.
Bridging the finance gap
One big difference between property and other forms of investment diversification is the high level of capital for entry required. Much like the renters, the initial barrier for some investors is the financial commitment. One way around this barrier is via a bridging loan. Intended to be used on a short-term basis, bridging loans from MT Finance can provide investors with up to £10,000,000 to capitalise on opportunities as they arise.
One popular form of property investment comes via the auction market as bargains can often be found below market value. Bridging loans provide investors with the chance to take advantage of such openings as they can be prearranged with indicative terms before the auction takes place. This allows investors to attend the action and bid knowing that finance for property purchase is in place already. Lending decisions can often be made within hours and funding can be released within a matter of days allowing you to complete on time.
The foundation for any investment is timing, and a bridging loan can be set in place allowing you to move when the time is right. To get more details about bridging loans, call MT Finance on 0203 051 2331 or leave your details on this contact form.