The growing need for flexibility has created a great opportunity for property investors to benefit from.
Are you a subscriber?
Millions of people in the UK are.
If it’s musical, visual, edible, or you can pull it over your feet (socks, in case you’re wondering), it seems the British will subscribe to it.
And that means companies offering subscription services are booming.
Let’s look at some examples…
At the end of June 2019, on-demand TV service Netflix had 11.6m subscribers in the UK.
Music streaming service Spotify, meanwhile, had racked up 108m worldwide subscribers at the end of June this year.
And, amazingly, one in four people in the UK now pays for some kind of subscription box, with everything from tea, food and alcohol to make-up, socks and flowers available in exchange for a simple monthly direct debit.
If you want some idea of how much the subscription box industry alone will be worth in 2022, how’s this for a big number… £1bn!
And it’s not just smaller items or digital services we’re subscribing to, either.
At the end of 2018, 1.6m people in the UK were leasing cars on deals that offer them the flexibility to easily change their vehicle every two, three or four years.
People ‘subscribe’ to homes, too
Bear with us…
What we mean by that is renting has become a choice rather than a necessity for many, particularly the millennial generation.
Why? Because renting provides flexibility. Yes, that word again…
Like the flexibility of being able to change your car every two or three years, renters are able to move when it suits them – rather than being hamstrung by the often lengthy process of having to sell a property.
That desire for flexibility has led to a surge in tenant demand in recent years.
And that demand has presented property investors with a golden opportunity to generate healthy rental returns from a rapidly changing profile of renters in the UK.
Renters are getting pickier
That means property investors need to keep up in order to stand out from the competition.
The most important thing for tenants in 2019, according to research by law firm CMS, is staying connected.
The rise of flexible working and young people starting their own businesses means tenants are spending more hours in their rental properties than ever before.
And that means they need to be online.
Investors offering WiFi included in monthly rents will always stand out from those who aren’t – and those throwing in a subscription package like Netflix or Spotify, too, will have great tenants banging down the door to sign up.
They’re also eco-conscious
Reducing our carbon footprints is arguably something we should all be doing.
But property investors, especially, can make a great first impression with potential tenants by showing their green side.
That means energy saving lightbulbs throughout their rental properties, energy efficient appliances and glass kitchen storage rather than plastic.
Investors could even consider offering a reusable coffee cup with every tenancy to help reduce the number of disposable cups going into landfill.
Or maybe even a weekly vegetable subscription box so they can cook healthy meals with next to no waste packaging?
Making property investment work for you
It’s all well and good standing out from the crowd when looking for tenants.
But if your own financials aren’t in order when investing in property, it can be a short and painful journey.
The key to successful property investment lies in managing levels of risk, focusing on rental income rather than capital gains and utilising the skills and experience of people who have been there and done it.
House sharing for young professionals has arguably never been more popular in the UK.
The cost and social aspect of shared living works for them.
The returns and multiple streams of income work for the investor.
Indeed, investors building portfolios of highly-profitable houses in multiple occupation (HMOs) are seeing returns of between 10 and 15% on equity from each property they own.
As our society strives even more for flexibility, specialist buy-to-let property investment can be a game-changer.
But HMO investment is complex and staying compliant is crucial, so it needs to be done well and with the right support.
This article comes courtesy of Platinum Property Partners, a specialist property investment franchise which has created a FREE e-guide to help potential investors understand how HMO property investment works and how investors can generate returns of 10 to 15% on equity. Download it here.