The simple fact is that since 1952, UK property prices have doubled every 8 years. This growth isn’t linear but cyclical – sometimes the growth has been more over this period and other times it has been less - but if property is viewed as a medium to long investment, then history proves this strategy to be successful.
Over the past few years there has been something of a housing boom in the UK, and a number of people have become wealthy through investing in property. Recent rises in interest rates has slowed down the market a little bit, but there are a variety of factors - a rising population, higher numbers of people living on their own, too few houses being built to keep up with the demand, dissatisfaction with personal and company pensions, better financial products and an appreciation of the benefits of investing in bricks and mortar- that should ensure that house prices continue to rise.
Indeed, the National Housing and Planning Advice Unit (who were set up in June 2007 to advise regions on their local housing needs) forecast that within 20 years, the average house will cost ten times buyers annual earnings. At present, the average home in England is seven times the average yearly income. In 2000 it was four times the yearly income.
These figures suggest that property in the UK remains an excellent medium to long term investment.
Increasingly attractive to investors more recently are the overseas property markets. Some investors buy with a view to using their properties as holiday homes, whilst others have no intention of doing so, but the rewards can be excellent with huge growth being achieved if properties are bought in the right place at the right time and the right price.
For example, properties on the south-eastern side of Cyprus around Larnaca are predicted to rise by 15-20% over the next 3 years as the area becomes more popular and accessible to tourists due to low cost airlines. A large expatriate community, 300+ days of sunshine a year, a friendly and largely English-speaking population, a legal system based on English law and favourable tax regime add to its attraction. With the addition of a planned 14 golf courses and Cyprus joining the euro in January 2008, it really does represent a great investment opportunity.
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