When making your first investment in property, setting a budget is one of the most important elements of all investment strategies. If you have a significant lump sum of money available, investing is a great idea as it allows you to maximise your income and give your savings accounts a boost. If you have a budget of £50,000, you’re in a good position to get into real estate investing. In this helpful guide, we’ll talk you through the best way to invest 50k in property for a successful and lucrative venture.
Make sure you’re ready to invest
Investing is a big commitment, so before you go through with investment in a rental property, one of the biggest pieces of financial advice is that you need to be sure you’re ready. If you have a significant amount of savings and you’ve set yourself a budget of 50k, then you know you can invest 50k safely without it massively impacting your financial situation if things don’t go to plan. However, if the 50k you’ve saved is essentially your life savings, you’ll want to reconsider pooling all this money into an investment.
If you feel that you’re ready for buying an investment property to rent with this budget, then you should also make sure you invest 50k wisely by finding a good property investment company and popular developer to work with to invest money into property. This way, you’ll have more peace of mind in knowing that your funds are safe and your investment is in the right hands. You should also consider finding a good property management company if you don’t have the time to run the property yourself – this is commonly known as making a hands-off investment or passively investing.
Invest in off-plan Property
Off-plan property investment is a type of investment where the development isn’t yet complete before you purchase the property. This kind of buy to let property investment is becoming one of the most popular types of real estate due to the benefits available, such as the potential for capital growth and the fact they’re offered at below-market rates. Due to their low cost, off-plan investments are particularly appealing for those looking for the best way to invest 50k in property, so if you want to find a high-quality investment with a lot of potential for investment returns and capital growth, buying off-plan is a great way to invest 50k safely.
Again, it is so important to choose a trusted company to work with when buying an off-plan investment. Since you can’t take a tour of the existing development, it’s crucial that the developer has a strong reputation and a track record of producing quality properties. At RW Invest, we only work with trusted UK developers for all of our off-plan properties and offer our clients regular construction updates to keep them up to date on the progress of their investment. We also use technology like virtual reality and computer-generated imagery to give investors a better idea of how the property will look once it’s complete, allowing them to make a more informed decision before buying an investment property to rent.
Build up a property portfolio
The best way to invest 50k in property is to think of this initial investment as the beginning of your property portfolio, or to spread the amount across multiple investments. Building a property portfolio is a great way to increase rental incomes and is also ideal if retirement planning is your main motive behind investing in the property market.
If you want to know how to build a property portfolio with 50k, there will be different ways to do this depending on your method of investing. If you want to purchase the property outright, buying properties won’t typically be possible with 50k as you’ll only be able to afford one quality investment. When you begin to make rental returns, however, you can start thinking about making additional investments as a way to spread your risk. By having a wider portfolio of properties, you won’t be at risk of losing all your income if one of your investments suffers.
Alternatively, if you’re going to use a buy to let mortgage for your investments, you’ll be able to build your portfolio more quickly. Do your property market research on the best areas to invest in and try to make your portfolio as diverse as possible by choosing some variety in rental yields, property type and house price. Bear in mind, however, that if you’re buying off-plan properties, you’ll struggle to secure a buy to let mortgage so will need to pay for the property outright.