How to Achieve Financial Security

A New Year, a New Year’s Resolution. It’s typically at the start of the year that we take an introspective look at what we would like to achieve over the next 12 months. January is the best time to look further out and make some sensible decisions around where you would like to be in 5 or 10 years time. Many do this with their careers, carefully mapping their road to success, but how about looking at crafting a future for yourself and your family with something you can control? A business that is not only enjoyable to do, but one where if you do your homework and plan well, you will not fail to succeed. How can we do this? I hear you ask. Well, the answer is property, and more specifically, buy to let property in city centres. The latest phenomenon in the UK is a property sector that now offers city centre living to a new generation of buyers and renters, that no longer wish to live in the suburbs, but one that can now live within the city centre with all the benefits that brings.

Why Property?

Simply put, you want to run a business that provides an income and growth potential, but haven’t got time to step away from your day job and set up a new business. Remember, becoming a buy to let investor means that you can still hold down a day job, while at the same time building a new business. You just need to allocate some of your spare time and weekends when researching the property. Once purchased, the business will run itself, as you can rely on experts to do the lettings and manage your properties. All you have to do is choose the right property, in the right area.

What About Brexit?

This is a question we get asked constantly. The one answer I have given across the board is that the timing of any decision you make is never going to be perfect, and over the life of a property prices will fluctuate. It is up to you to try and mitigate any extreme events, such as Brexit. In this case, our view on Brexit is quite clear, unlike the solution, no one has an answer, in fact the worse is expected and as such, market prices have already been heavily discounted. Developers have resisted increasing prices over the last 6 months on new build projects, and prices in areas like London and the South East have now dropped for the last 18 months, and look set to continue to drift. Across the UK in general though house prices have risen, and although activity had dropped somewhat, we have started to see transaction levels pick up in the last few months. With that we have started to see prices begin to lift a little and we now fully expect to see those that had put plans on hold over the last year or so to now re-enter the market space and once again drive prices higher. So to answer the header, for us before is good, an opportunity to beat the rush!


As aforementioned, the key areas are away from the traditional, London and the South East and more on the Midlands and North West, with 3 key cities tipped to outperform. these three cities are Manchester, Liverpool and Leeds. Manchester is an obvious one, as the city continues to drive itself forward. Fast becoming a key destination for businesses and
people alike, with a truly international feel. It’s close neighbour Liverpool is also no surprise as it has been the fastest growing private rental market for
some time now and offers the best returns in this market than anywhere else in the UK. However, Leeds is perhaps one city that has avoided the limelight a little of late and is in our opinion a hidden gem. With the latest announcement from Channel 4 that they are placing a production HQ in the city, Leeds has a strong tradition in private industry, being the home of a large banking, legal and insurance business, with the highest proportion of private workers to public workers in any city in the UK. What does this all mean to you the investor? It means the opportunity to not only take advantage of prices that have been stagnant for the last 6 months, but an opportunity to buy into cities that have a lack of housing in markets that are growing rapidly, and are desperate for quality city centre housing.

Company or Not?

A tough question, and one we are happy to offer advice on, but one that we would suggest you consult an expert on before committing, as everyone’s circumstances are different, and it is not a one-size-fits-all policy. In general, it is now a lot easier to set a company up and trade, with requirements around income considerably softer than it was say, 2-3 years ago. Mortgages, although still a little difficult are more abundant than they were again a few years ago and in general all rules have been relaxed a little to allow the shift to Limited companies. Remember though, there are always a lot of compromises here and although for some this method makes sense, if you wish to live of the income in the short-term then maybe putting the property in to a Ltd company isn’t the best. Generally, we say run the numbers and see what’s best for you, all of this is very much governed by what you are looking to achieve.

Income or Growth?

This has to be decided before you embark on the journey, but typically in this scenario, people are looking to build a portfolio over a number of years, and are trying to make a profit over and above the costs of running the property. They will then look to re-invest those profits by purchasing further property for their portfolio. So, a good blend of income and growth is ideal, but remember to leave enough breathing space between costs and returns, because if interest rates suddenly shift, or costs increase, you need to have enough room to cover and unforeseen eventualities. When you start you are looking to build, so any income you take should be re-invested. It is both tax efficient and the correct approach, as you are looking to build something for the future, and taking income now from the business should not be something you look to do.

For us, property remains a fantastic investment, one you can easily do in your spare time, allowing you to involve other members of your family or friends. This can lead to a very satisfying business that you can build over many years, and when you are ready to step off the hamster wheel of life, one you can reap the rewards of those seeds you sowed many years earlier.

Further reading