The Value of Property Investment: How Investing in Real Estate Helps Grow Your Investment Portfolio

If you want a steady stream of income and long-term growth, real estate investing is a popular and proven way to grow your investment portfolio. Building a property portfolio can be a lucrative proposition for investors both new and seasoned with the right strategy. 

Off-plan property investing

Off-plan property is one popular and proven strategy for real estate investing. This means purchasing a property before it is built or while it is in the early stages of construction. Lower price points than would be available when the property is completed are opened up by buying off-plan, giving greater potential for capital growth or quicker return on investment. As the property is being built, the value of the property will typically increase, allowing the investor to sell the property for a higher price.

Other types of property investment

Depending on your financial goals you may opt for one kind of property investment over another. Here are some of the most common types of property investment:

Residential rental properties

This type of investment involves buying a property, typically a single-family home or apartment, and renting it out to tenants. Residential rental properties can provide a positive stream of rental income, as well as the potential for long-term appreciation in the value of the property. However, they often do incur some form of maintenance cost, whether that is via a maintenance and management company or done privately is up to the individual investor. 

Commercial properties 

Buying a property that is used for commercial purposes, such as an office building, retail centre, or industrial park. Commercial properties can provide higher rental income than residential properties, but they also come with higher expenses and more complex management requirements.

Vacation rental properties

A vacation home or apartment is bought for the purpose of renting out on a short-term basis. Vacation rental properties can provide a higher return on investment than long-term rentals, but they also come with higher turnover costs and more maintenance expenses. Sometimes this isn’t considered a typical property investment due to the amount of work which goes into managing the rental needs and schedule.  

REITs: REITs (Real Estate Investment Trusts)

Companies that own and operate income-producing real estate are publicly traded on stock exchanges. They allow investors to invest in a diversified portfolio of properties without having to buy or manage them individually. Downsides to this method include paying higher taxes on dividends than other investments (they don’t qualify for the capital gains rate) and potentially high management fees.

Property flipping

A short-term property investment which involves buying a property in need of repairs or renovations, fixing it up, and then selling it for a profit. This can be a profitable investment but it also can be very risky and time-consuming if the property doesn’t sell quickly or if the renovation costs are higher than anticipated. It can also feel like adding another full-time job, contradicting the reason many go into property investment: more free time. This is more often a strategy adopted by those with development experience and contacts.

How Redmayne Smith can help

Growing a real estate portfolio can be a complex and time-consuming task, especially for new investors. One way to make the process easier and more efficient is to work with an experienced property investment company like Redmayne Smith that can advise and support you. Our team of property experts can help you to  –

Identify the best investment opportunities

With a deep understanding of the local market, we can help you identify the best investment opportunities, such as properties that are undervalued, that are located in up-and-coming areas or that will command exceptionally high rental yields.

Conduct due diligence

We conduct thorough due diligence on potential properties, to ensure that the properties you invest in are sound investments. For off-plan properties, we recommend a selection of developments that we have vetted and approved through a rigorous 31 point selection process .

Gain financial advice

Our expert investment consultants can help you navigate the financing process by connecting you with lenders, and guiding you through the financial process.

Obtain Legal Guidance

Solicitors are essential to property investment – we recommend trusted providers to ensure that your journey is smooth and timely.

Manage properties

Once you have invested in a property, our recommended property management companies can manage the property on your behalf, including finding tenants, collecting rent, and handling maintenance and repairs. Working with an experienced property company can help you make better investment decisions, save time, and increase your returns. Backed by decades of experience and knowledge with the ability to navigate the ever-changing property market, Redmayne Smith can help you mitigate the risk of your property investment.

Advantages of property investment

Real estate investing differs from other types of investment in several ways. First, real estate is a tangible asset that you can see and touch, unlike stocks or bonds. Additionally, real estate can generate income through rent, or you have the advantage of property appreciation. By comparison, stocks and bonds only generate income through dividends or interest payments. Real estate investing is a great way for new and experienced investors to grow an investment portfolio. With the right strategy and approach, it can be a financially sound way to invest. With industry statistics showing a consistent return and the ability to invest in off-plan properties, real estate can be a smart addition to any investor’s portfolio. 

How to add property to your portfolio

Property investment may look like the best way to grow your wealth, but it can also be a complex and overwhelming process for newer investors. However, with the right guidance and support, growing your property investment portfolio can be a straightforward and profitable venture. 

To make sure your investment aligns with your short and long-term vision, it is worth determining an investment plan and setting some goals. Investing in property means that you will need to ask yourself certain questions like –

• Are you looking for short-term gains or long-term appreciation?
• Are you looking to generate income through rental properties or flip houses for a profit?
• Will you invest in pre-built or off-plan developments?

Once you have a clear understanding of your investment goals, you can start researching potential properties and markets. Also, understanding the different types of mortgages and financing options available is essential, along with understanding the costs associated with buying and owning a property, such as –

• Deposits
• Closing costs
• Property taxes
• Insurance
• Maintenance

One of the most beneficial steps a new investor can take to grow their portfolio is to work with a professional property consultant or property investment company to benefit from their knowledge and support throughout the investment process.

Growing your property investment portfolio

Partnering with experienced property investment consultants like Redmayne Smith will help property investors to grow their portfolios and –

• Identify viable properties
• Align investments with goals
• Analyse the financial viability of a property
• Assess market research
• Navigate the financing process
• Secure a mortgage
• Understand legal and tax-related issues
• Find and screen tenants for rental properties
• Handle property management and maintenance
• Exit investments

We help you navigate the complexities of property investment and grow your portfolio the right way. The team at Redmayne Smith will provide valuable insight and guidance to strategically guide and manage your investments and use their experience to set you up for success.

Contact Redmayne Smith today to speak to a property investment advisor.