A rising number of investors are intending to add to their property portfolios, new research has shown. The Young Index revealed that during the second quarter of this year, 13.3 per cent of landlords indicated that they are planning to buy additional assets outside London in the private rented sector. Meanwhile, 46.3 per cent of those surveyed stated that they are considering purchasing real estate in the capital.
In addition, over half (56.6 per cent) said that they intend to retain their property portfolios for at least the next decade, with 38.2 per cent planning to keep their assets for 20 years or more. A large proportion of the landlords questioned also had a positive outlook for the capital growth of their portfolios, with 91.3 per cent expecting London property prices to remain the same or higher over the coming 12 months, while 54.5 per cent have the same anticipation for assets outside the capital.
A recent report from BNY Mellon Investment Manager urged investors to look at the benefits of a diversified investment portfolio by including real estate investment trusts (REITS) alongside private residences. According to the firm, REITS can deliver a higher income and greater transparency than other forms of property investment.
However, the organisation agreed that owning specific assets gives investors greater control over which markets and property types they are putting their money into. The Young Index found that many landlords hold other forms of investment, including equities, shares, premium bonds and cash on deposit.
Although the number of property investors with these asset classes has dropped over the past 12 months, it appears that such professionals are diversifying their portfolios with alternative investments - such as art and wine - or offshore investments instead. The latter asset class in particular appears to have grown in popularity, with 23.8 per cent of landlords now holding such investments, compared to six per cent in 2010.
- Thursday 28 July 2011