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British Pearl

Is direct property investment for you?

27 October 2018 • British Pearl

The average homeowner in Britain aged 65 or over owns property that has soared in value by £159,000 over the past 23 years, amounting to a gain of £7,000 per year. The overall increase in property wealth in London is over double that, at £14,257 annually. This property wealth could enable pensioners to generate returns which could contribute to their quality of life as well as the lives of their children, through rental income, equity release, downsizing…etc. Property has its benefits and drawbacks for use in later life.

Benefits

  • Property investment has, over time, been resistant to inflation. Yields (a year's rental income as a percentage of how much the property cost) remain robust versus inflation plus there is potential for capital gains. This income cushion could remove some of the stress associated with property investment.

  • Property is simple and straightforward compared to financial markets and instruments with complex terminology. You know that your investment is in something solid: bricks and mortar.

  • Investing in property over some other intangible asset classes gives you control. You choose the location, how you buy and how you make your money: through tenants, refurbishment...etc. Remember that a fall in price does not translate to a loss until the property is sold. You can hold the investment, still generating an income through rent, until the price recovers.

Drawbacks

  • Traditional real estate requires a huge sum of money to be able to get started. A deposit for a first-time buyer in London is expected to reach £250,000 within the next ten years.

  • Building a diversified portfolio is now less attractive and more expensive due to the 3% higher rate of stamp duty on second homes.

  • Personally managing rental property can be time consuming, expensive and stressful - especially if your tenants are unreliable.

  • Property as an asset class is relatively illiquid, meaning it could take a while to sell and your ability to be able to access your investment funds quickly and efficiently is considerably constrained.

  • Knowledge and experience are required to differentiate between a good investment from a bad one.

British Pearl has the solution

  • Invest anything upwards from £100 using our simple, flexible platform.

  • Spread your investment across several properties which vary in sector, location, risk, and more. There are multiple choices for how you can invest through British Pearl, including an ISA. You can oversee your property investment portfolio in one location; diversification made easy.

  • We handle all of the management, taking away the hassle. Our Property Team has key connections to source high quality property investments.

  • Our Resale Market will allow people to list their shares and loans in order to sell them to other investors. It is important to note that we cannot guarantee that someone will be able to sell (exit) when they want or at the price they want and liquidity is dependent upon matching with a willing buyer. However, you now have the opportunity to exit so need not feel trapped inside a completely illiquid investment.

  • We have dedicated teams in property, finance, law, technology and more to make sure your investment is in capable hands. Each property is assessed in detail so you can be making an expert decision without needing to understand all the complex jargon.

With British Pearl, you can spend as much or as little as you want and cherry-pick your own investments, without the stress of being a landlord. We aim to be a property investment company centred around its investors, so you can enjoy the benefits of property investing without the headache.

Sources

  1. Mortgage Strategy / Over 65s in London earn 14,000 plus from homes
  2. What Investment / Why is property investment best for your retirement?
  3. Your Investment / Why property really is the best investment
  4. Business Insider UK / Average London home deposit set to hit nearly 250,000 by 2027

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Your capital is at risk Investing in property involves risk. The value of your investment can go down as well as up and historic performance is not a guide for future performance. Any projections of future performance are based on all information known at the time of share investment or loan, and internal calculations and opinions of British Pearl. These are subject to change and are not guarantees and should not be relied upon as such. Risks include the total loss of your share investment or loan, variable rental income due to property not being rented or a depressed rental market, and inability to sell your share investment or loan due to lack of a buyer. Investing with British Pearl falls outside the remit of the Financial Services Compensation Scheme. Please refer to the Key Risks section of this site for a more comprehensive description of the risks involved.

British Pearl ® is the trading name of British Pearl Limited (Company No. 7151774), a company authorised and regulated by the Financial Conduct Authority (Register No. 674693) and British Pearl Finance Limited (Company No. 10575280 and Register No. 770867), which is an appointed representative of British Pearl Limited. Both companies are wholly owned subsidiaries of British Pearl Group Limited (Company No. 9701436) and all are registered in England and Wales at 4th Floor, 7-10 Chandos Street, Cavendish Square, London, W1G 9DQ