Why Property

Why Invest In Property?

We believe that it is incredibly difficult to achieve financial freedom through saving money alone, especially when interest rates are low & inflation is high, so we invest in capital to make our money work for us. At Global Property Investors we know that property is THE best investment to achieve long-term wealth.

Did you know that over 40% of the Times Rich List have built their fortunes through property investment? Why not copy them to become wealthy too?!

Although there is a lot of misinformation in the media about property (it helps to sell newspapers, doesn’t it?!), we want to dispel some of the myths and confusion that exists, to provide you with a clear & researched view based on the facts.

People will always speculate but the facts speak for themselves.

Property History

  • Since 1948 property in the UK has risen on average 8.5% year on year.
  • Since 1962 the office of national statistics have recorded that rents have risen on average by 13% per annum.
  • On average, UK property prices more than double every decade.
  • Over the last fifty years, UK property has only gone down twice in real terms – 1971-73, and 1989-92. Five
    years out of fifty.
  • Since 1956 the compounded average annual increase in house prices has been 8.5%. To put this into
    perspective, a house bought in London 50 years ago for £1000 would today be worth more than £1 million.
  • Inflation in the last 50 years has been 1,689%. The stock market has grown by 2,700%, but UK house prices
    have increased by 22,000%.
  • More millionaires have been made from the property market than through any other investment vehicle. A
    property bought for £35,000 in 1983, would today be worth about £200,000, an increase of over 571%.

The Time Is Now

The UK population is growing and there is huge demand for property (the population totals 62m in 2011 & is
forecast to be 71m by 2031).

House building in the UK has not kept pace with the demand and there is currently a housing shortfall of 120,000
new homes per annum*.

The Halifax estimates that the shortfall will increase to 400,000 per annum by 2021.

UK property prices have softened in some areas recently but values have always returned in the long term. If you invest in the right areas, when the market corrects, the potential forcapital growth will be huge.

For these reasons we are passionate about property investment and believe now is also the best time to invest because it’s:

  • A stable, tangible asset
  • Essential
  • Consistent growth
  • Outperformed most other investments
  • Low prices, rising rental yields

Let us now look at a table showing the equity (net asset value after loans etc) of several investments at different rates of return and inflation. We will invest £100,000 and assume that the investments are made with the best available borrowings (maximum gearing) that the investments are made for 20 years and that property inflation is running at 5% pa. Buying costs are factored in where significant. Stock Market Growth (total returns including dividends) is assumed at the 35 year average rate of 5.8% pa plus inflation (although Barclays state that it is unlikely to be able to maintain this rate going forwards).

Type of Investment Investment Value After 20 years ValueIn Today’s Money Income From Investment Income from Annuity If Asset Sold
Cash £100,000 £198,978 £133,907 £4,687 £5,356
Stock Market £100,000 £449,133 £302,253 £10,579 £12,090
Tenanted Commercial Property (7% yield) £272,480 £722,969 £486,537 £34,058 £19,461
Buy-To-Let Property £646,667 £1,169,132 £786,792 £50,923 £31,471

What does this mean for the UK property investor now?

With demand for housing far exceeding supply, inflation and unemployment rising, and mortgage lending difficult
for First Time Buyers, rental demand is up and rental yields are on the rise. Savills predicts that rents will grow
+6% to +7% per year for the next three years.

Using our experience and knowledge Global Property Investors can either buy you one property or build you an
entire portfolio at a huge discount that provides instant cash equity,long-term financial growth and a monthly
rental income. How does that sound?

If you would like to discuss how Global Property Investors can help you achieve financial freedom through
property investment, call Steve on 0207 228 0259 or alternatively fill in the Contact Us form on the website
and one of our property consultants will call you back.

*Source: Halifax
*Source: Barker Report, 2004