Most of us with ambitions to own a property do so with a view to the security of having a long-term place to live in. Many also see it as a preferred way of accessing a necessary asset, as opposed to rental for example.
Putting money into bricks and mortar has increasingly become more than a way of putting ‘a roof over our heads’. For many it is an investment in our future as opposed, for example, to putting spare cash into a pension. With property ownership well established in the UK psyche and heavily influencing our lifestyles, property has become central to the way we plan & organise our finances.
Other ways property influences our lives:
We may move to a more expensive or bigger home either as a lifestyle statement or because family practicalities dictate
We may move to a less expensive or smaller home. This ‘downsizing’ may again be a lifestyle decision, but may also be a life stage choice to meet a need for retirement income or even nursing care fees
Some of us may also be intentionally accumulating equity in a property or looking to leave a financial legacy for our dependents
The times are changing: Buying for rental
More recently, people have become interested in buying second homes and letting them out for rental. Some will also have factored in the potential increase in value of the property over the period of their ownership.
Buy-to-let has created a nation of landlords and is much more directly comparable to investment in other asset types, for these reasons:
Rental properties provide potential for capital growth over time
The owner may also receive an income in the form of rent
An investment risk is taken as the owner must choose what type of property to buy, where and how much to pay. All of these factors involve a decision about the local market, suitability of the property for rental, and timing as to when to sell or buy another property