If you are an experienced property investor looking to grow your property portfolio, you probably have an investment strategy that works for you. However, many first-time buyers who have successful careers and with cash in the bank, don’t have any experience when it comes to their own personal investments. Therefore, when considering your first property for investment, novice investors should consider the risks against possible rewards.
You might have heard the saying risk and reward. All investments come with some element of risk. Typically, investments with the potential to return the most, usually have the potential to lose the most.
Before making any final decisions when purchasing property, maybe you should ask yourself, “what is my attitude to risk” when buying property for investment?
When buying off-plan you expect the property price to be less than when buying a property that is completed. See below just a few pros and cons for your consideration;
Off-plan pros
- Lower attractive prices.
- Stage payments throughout the build.
- On completion, property is expected to have increased in value.
Off-plan cons
- Delays in build
- Quality of build is disappointing
- Developer has financial problems
Completed projects pros
- See what you are buying
- Immediate rental returns
- Ability to check on rental history
Completed projects cons
- Pay the full purchase price
- Paid more for the property
- Lower rental yields
Off plan attracts the higher risk investors looking for initial less cash outlay and lower purchase prices. Whereas the lower risk investor may prefer paying higher prices for a property that is completed although the eventual yield is lower.
If you consider yourself having a lower attitude to risk and prefer an investment that is complete with a 3-year rental history offering immediate assured returns then click here to view our latest student accommodation for investment.
There are more pros and cons that can be added to the above list that you should consider, if you would like further information, please arrange to speak with one of our property consultants.
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