Protect against threats to your UK Property Business
We were having this conversation today as we were driving back from viewings……thought to share.
The key to managing risk in the long-term is diversification – not putting all your eggs in one
basket. The way to do this is to vary the following factors when investing in property:
• Area – Try to invest in different towns and cities. Rental demand or property price
changes can vary according to area due to significant increases in crime rates,
redundancies, pollution etc.
• Property – Buy both private and ex-local authority properties. Consider both flats and
houses. Do not stick exclusively to two-bedroom properties – consider studios as well
as four-bedroom properties. This way you are not stuck with seeking a particular type
• Tenant – Consider both DSS and private tenants ( as well as Social tenants that the councils or home office support).
• Borrowings – Go for a mixture of fixed and variable borrowings. Do not stick exclusively with one lender. Vary durations.
The size of the property should be diversified. Ideally we mean if you are looking to buy/build a portfolio buy some 2 bed properties…as well as 3 and 4 bed properties.
This is what we do…Plus we have professional HMOs, buy to lets and Social HMOs that are on full management, no voids…and maintenance is covered up to 5,000 per year. Mix them up and diversify to some degree your property portfolio.