The interest rate has sat at 0.5% for seven years and during that time experts believed that any changes to the rate would go in an upwards direction. Following the decision to leave the EU, the Bank of England decided to cut the base rate in an attempt to kick start the economy again.
Property investors should benefit from lower mortgage rates which means that it will be cheaper to finance an investment. This will result in property investments becoming a real possibility for investors.
Cuts in the base rate has also caused the pound’s value to relax and this makes it even more appealing to invest in UK property for overseas investors as their money will go further.
There was a lot of negative talk leading up to the EU vote about the way in which the property market would behave should the UK leave the EU. One of the warnings intimated that house prices could fall considerably.
However, the property market still remains strong and this is due to the demand in property. It is reported that there is a requirement to build 300,000 more homes each year in order to keep up with this demand and this will also help to slow down price increases. The gulf between supply and demand will only continue to encourage a rise in house prices as well as the growth of the rental market. This will mean that investors will still consider investing because of the potential returns.
In the past, a buy-to-let property was the only way in which an investor could invest in property. However, there are now more options without having to invest in bricks and mortar. Online property debt investment offers a lucrative alternative as it can result in solid returns without the pain that can come with being a landlord.
Certain specialist lenders enable investors to invest in secured mortgage loans which can see returns of over 7%. Borrowers on the other hand will have the ability to access specialist finance in order to fund the purchase of property.
Investors can pick and choose which mortgage loans they want to invest in and this will then enable them to build their own online property investment portfolio at a lower cost when compared with purchasing a property. Interest is earned from the very start because the loans are pre-funded before being made available.
At the end of a loan, the investor is given their capital along with any interest and this money can then be reinvested or withdrawn. This removes the problems and headaches that come with being a landlord. The loans are secured against the property of the borrower and should payments fail the property can be repossessed in order to retrieve any losses.