Amongst all the doom and gloom, we wanted to highlight why our tiny corner of the UK property market is actually the perfect place to park your money during this pandemic.
- Tangible Objects Don’t Disappear
A directly owned piece of real estate is a very tangible object particularly when compared to stocks, funds and other financial instruments. The value of a property can still go down however it cannot simply disappear overnight and people always need a place to live.
- Long Term Is Good
Based on the unique set-up of a Life Tenancy Agreement, you will know that the best return or profit is made once the tenant vacates and this could be long-term. Right now, long-term is good. We as a species are currently in some very unknown territory and we have no idea how long this pandemic will be affecting our lives and economies.
- Profit Locked In On Day 1
Right now, landlords across the country are nervous that their tenants will not be able to pay their rent. Unlike other forms of UK property investment, with a Life Tenancy Property you essentially take all the rent upfront as opposed to it being drip-fed and it risk from cash -strapped tenants.
- Property Market Crash Won’t Result In Loss
Property markets are typically uncorrelated to the stock markets but that doesn’t mean they won’t suffer too. If the UK property market does crash, then your asset will likely lose value. But if that asset is a Life Tenancy Property and you paid half price for it and it loses 25% value in a crash, you still haven’t lost any money because the asset is still worth 25% more than you paid for it.
- Helping the Most Vulnerable People
Lastly, amongst all the talk of yields, profit and equity etc, with a Life Tenancy Property, you are helping the people that are currently most vulnerable, the elderly. By investing in a Life Tenancy Agreement you are helping an elderly person or couple secure a home for the remainder of their life without the worry of rental or mortgage payments.