Is There Such a Thing as a Secure Property Investment?

This is an easy one, of course there is; just ask the millions of people currently buying real prime property in leading cities as a hedge against cash-devaluation. Or just ask anyone prompted to search for property investment advice following the trillions lost on stocks and shares in the latest crash following the US downgrade by Standard and Poors. But of course, lest we not forget that thousands of people lost millions of Euros, Pounds, Dollars and Yen on Dubai properties, many of which still haven't and probably never will be built.

The key words are property investment strategy; the basic fundamentals of which are:

  • Research, research, research
  • Check supply and demand dynamics now and into the future
  • Take nothing at face value from a seller, an investment consultant or anyone else giving advice on property investment, unless they are 100% impartial
  • Check everything with your own research.
  • Think about your exit strategy, and use any further investment to make the property attractive to that demographic

If those who came unstuck in Dubai had followed the above, most of them would not have invested, because the supply/demand dynamics were heavily set in favour of supply.

There is no such thing as a risk-free investment, but if you take every possible step to reduce risk then your investments will almost always be secure.

The following is a sound strategy for investing in property (we have many a property investment guide on the site going into more detail):

Choose a good area: this should be an area where economic growth is strong and accelerating, where unemployment is low and falling, and, preferably where building space is limited or building is otherwise subdued. Look out for these things and you will soon find an area where demand is outstripping supply for one or more property classes that you can invest in.

Choose a good property and begin research: if the property is off plan then you research the developer, to see if they have successful developments under their belt, and to ensure they are not in any financial difficulty. If they look likely to be relying on off plan sales to complete building stages, don't touch it. If the property is not off plan check out the owner.

Next check out the property: check that the seller is the registered owner on the deeds of the property or the land if off plan. On off plan properties you should then check that the developer has planning permission to build what he is selling. If buying abroad find out as much as you can about the local area, the history of the title, and try to minimise any chances that the property could be declared illegal, or reclaimed by some historical family thrown out of it during some war. If in doubt, don't shell out.

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*This page is provided for information purposes only and should not be construed as offering advice. Flex Profit Hub is not licensed to give financial advice and all information provided by Flex Profit Hub regarding real estate should never be treated as specific advice or regulations. This is standard practice with property investment companies as the purchase of property as an investment is not regulated by the UK or other Financial Services Authorities.