Students yield best return for overseas property investors in Scotland.
With banks like Nationwide predicting a 2 per cent growth in the property market during 2012, there is no time like the present for investors to snap-up good quality homes in Scotland.
And who better to have as tenants than the country’s growing student population? Why students you might ask? Research by mortgage specialist Paragon showed that by having students rent a property, landlords can expect much higher yields compared to young singles and retired people.
Rents are on the increase and at this very minute Grant Property has 100 per cent occupancy in prime areas within its Scottish property portfolio, reflecting the buoyancy in the rental market. Yields are between 7% – 9%, considerably higher than the national average of 5%. Scotland’s demand for Student rental accommodation is also expected to increase year on year with UK and overseas students continuing to choose Scotland as their preferred place of choice for further education and University.
What’s more, while it has been challenging for first time buyers to secure a mortgage in the last few years, Buy-to-Let mortgages on the other hand have risen sharply in 2011 allowing investors take advantage of very favourable buying conditions. Gone are the days when you would hear people saying “it is a sellers’ market.”
On a continental scale Scotland has coped well since the Euro crisis unravelled. As the finance world waited with baited breath to realise the impact, those in the world of property rested assured that their slice of the market would emerge relatively unscathed. In fact looking at figures from the last six months, prices have risen, which is what has happened throughout every financial crisis we have witnessed.
Since prices fell in 2008 the property market has regained its composure. In saying this there is still a huge opportunity to buy prime property, under value and at higher yields then ever before. Fortunately for investors, property assets are polar opposites of shares and bonds, because unlike property, shares and bonds are liquid and far more exposed to market volatility.
As an investment, over any given period, residential property has outperformed shares and commercial property. Over the last 40 years, the average growth figure is 7 per cent per annum which is a leverage of 28 per cent return per annum, showing that property remains a smart investment.
Scotland’s University Cities have experienced increased buying activity in the first quarter of 2012 which suggests more demand for investment properties and increased confidence in the property market. The timing therefore could not be better for UK and overseas investors to grow their assets in Scotland’s favourite cities.
However like all major investments, we recommend a few golden rules to follow:
- Location – choose a prime city centre location
- Traditional – opt for traditional properties over of new build. Historically they have performed better both in terms of yield and appreciation.
- Rent ability – look for a strong rent with high occupancy levels
- Price – shop around but don’t compromise on any of the above points
- Experience – seek advice from experienced property experts
We source properties for investors based on all of the above criteria.They then renovate and furnish to a high standard ensuring all the safety regulations are met, source relevant tenants and look after the ongoing property management.
Over the last 15 years we have helped clients invest in residential over 1700 times, therefore you can be confident you are in safe hands. We also have an unrivalled track record in providing property management solutions to landlords based both within the UK and overseas.
Our organisation’s ethos is to step into the customers’ shoes and deliver a service suited to their individual needs.
For further information please call
Ross Kelly on +44 7799 431284
or email email@example.com
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