More and more, property investors and traditional savers alike are becoming attracted to Property Bonds as a way of boosting income and avoiding the hassles of direct property ownership.
Here are a few of the drivers that are prompting this interest - do any of this resonate with you (especially if you're still learning about this asset class)?
- Bank interest rates for savers are at an all-time low. Savings accounts in the UK are struggling to keep up with inflation, let alone provide any real growth.
- Property is still seen as a secure asset class by those who know, and with not enough homes being built in the UK demand continually outstrips the supply.
- There are more and more obstacles in directly owning investment property. Heavier taxation for residential investment property and reduction of tax reliefs for expenses;difficulty in raising mortgage finance for buy to let; dealing with tenants; licensing; regulation, the possibility of rent controls; the list goes on). Many property investors are looking for less hassle and more profit: being the lender, not the landlord.
- As part of this movement, investors who are cash-rich and time-poor are looking to partner with developers by lending rather than getting directly involved in the day-today running of projects.
- In uncertain economic times a predictable fixed income for a known period of time has much appeal.
- Whilst no investment is in any way risk-free, modern Property Bond structures can offer credible security and a practical exit strategy should things go wrong with the developer - something that isn't usually available to direct peer to peer property lenders, for example.
Property Bonds are not for everyone - but if you qualify they have the potential to offer a very interesting boost to one's income and wealth - but only if you choose wisely.
We are UK leading experts in Property Bonds, Notes and tax-efficient sophisticated alternatives. Find out more about property bonds with our popular guide - download your complementary copy today:
All the best for now,
Graham Turrell - The Investment Engineer