05 Sep by Amy Jackson

What’s the Best Way to Invest 50k in Property?

How to Invest 50k Effectively

When making your first investment, 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 £50,000 to spare, you’re in a good position to get into investing. £50,000 is a lot of money, but it can vanish before you know it. To make the most of this amount of money, you should explore investment methods  –  but should you choose to invest in shares and stocks or opt for the buy to let type of investments? In this helpful beginners guide, we’ll talk you through the best way to invest 50k in property, along with reasons why buy to let is a good option for a successful and lucrative venture.

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Is it Better to Invest in Property or Stocks and Shares?

You might be wondering – what’s the best way to invest £50,000? There are different investment methods out there, but when it comes to the best way to invest 50k for high returns, buy to let investment tends to be a better choice than stocks and shares or stocks and shares isas.

This is because unlike when you invest in the stock market or invest in shares, buy to let property investment allows investors to generate two types of returns through both rental income and capital gains. The UK property market is also currently performing at an impressive rate, with predictions for increased growth and success over the coming years. If you currently have the funds available and you’re asking ‘what can I invest 50k in?’, don’t hesitate to explore property investment options.

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How to Invest 50k in Property: Top Tips

Make Sure You’re Financially Ready

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. The best way to invest £50,000 is to do it at a time when you feel financially secure enough to do so.

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 you’ve been saving money for a long time and the 50k you’ve saved is essentially your only cash savings, you’ll want to reconsider pooling all this money into an investment and instead focus on your personal finance a little longer. After all, you need to have some savings left for things like emergency funds. To get a bit more clarity on whether you’re managing money correctly, it might be worth meeting with financial advisers who can offer money tips and help you make your decision whether or not to invest.

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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

So you know that property investment is a great route to take, but you might still be wondering – what can I invest 50k in when it comes to specific property types?

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 RWinvest, we only work with trusted UK property 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 they start investing in off-plan.

Research the Best Place to Invest 50k

Location has a lot of influence over the success of a buy to let investment, which is why doing research on the best place to invest 50k in is an essential part of your investing strategy. In the UK, a number of cities are performing well in terms of their property market, with rising house prices, impressive rental yields and growing tenant demand hitting the headlines. While these are the kind of qualities you should definitely look for in an investment, finding the best place to invest 50k in should also involve a lot of focus on average property prices. The lower the average price to buy a property, the better, especially when you’re looking to invest money in property with a budget of £50,000.

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When researching where to invest 50k, one of the best UK areas is Liverpool. Not only does Liverpool boast some of the highest rental yields in the UK and plenty of rental demand, but this city is also known for its affordable housing market. According to Zoopla, the average price for a 2 bedroom house in Liverpool is currently £111,049, while a one-bedroom flat averages at just £98,770. Manchester follows closely behind, being well below the cost of properties in the South such as London, but with slightly higher prices than Liverpool.

Build up a Property Investment 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 income 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 investment risk. By having a wider investment portfolio of properties, you won’t be at risk of losing all your income if one of your ventures was to suffer.

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 by spreading your 50k budget across multiple properties. 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. Keep in mind, however, that if you’re buying off-plan properties, you’ll likely struggle to secure a buy to let mortgage so will need to pay for the property outright.

To Summarise – What’s the Best Way to Invest £50,000?

01. Make sure you’re financially prepared to make an investment.

02. Opt for the buy to let market instead of the stock market.

03. Consider off-plan investments as a more affordable option.

04. Research locations to find out where to invest 50k for the best returns and lowest prices.

05. Contemplate building a wider property portfolio.

Get in Touch With RWinvest today

If you’re still unsure of how to invest 50k in property, or if you have any questions about the buy to let investment market, contact RWinvest. We can offer you guidance to help you start investing and help you secure your ideal opportunity for lucrative investment returns. For more information on getting started in property investment, take a look at our beginner’s guide to buy to let property.

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