How to Build a Property Empire: Scaling Your Property Portfolio

One of the most common challenges you might face as an investor is scaling your property portfolio. Many landlords or investors have a single investment but struggle to take that to the next level. That’s where we can help. 

What follows is an excerpt from our Next Level Investment Guide: How to Build a Property Empire in Five Years. Download the full guide today. 

Once you have a property or two under your belt you can start considering scaling. This is the stage where things can go wrong quickly so taking things at your own pace is vital. Remember that typically, you’ll be in this for the long-haul, so don’t try to time the market or rush for the ‘best’ deals.

Always remember that in terms of growing a portfolio, time is your most important resource. Property and yield building inherently suit a long-term strategy centered around being in the market for as long as possible. You want to spend enough time in the market to take advantage of natural growth while also maximising the returns from your yields.

At this point, you should also have your ideal holding pattern in mind. Ideally, you’ll have thought about this during the planning stage of your investment but understanding that you’re planning to hold for five, ten or even 15 years can help inform what you decide to do in the future, meaning you can adequately research beforehand.

Building a portfolio through a limited company is a method of investment management that is quickly growing in popularity. Offering a number of unique benefits that individual investors wouldn’t usually experience, a limited company can offer flexibility when building the portfolio over the long-term.

That said, if you’re looking to build a property portfolio through a limited company, try and decide this well in advance. This method of investment can offer a number of benefits but may require a slightly longer set-up time that will need to be factored into your plans.

Don’t forget to track your key metrics – is your rental income covering your mortgage payments? Are they still providing reasonable returns? Do you have the preparation in place for your next properties?

You don’t want to take on more properties than you can manage. Start small and maintain consistency. If you’re reinvesting, adopt a patient approach, as a consistently positive cash flow can lead to very positive results. Typically you’ll look to rebuild your ‘deposit pots’ with any rental profit you make.

Also ensure you maintain your diversity. While you should have several locations, you can also have several asset types. It might be that you have several single-lets and a HMO. You may have one property targeting young professionals and another in a student area. By not having all of your eggs in one basket, you’re giving yourself the best opportunity to gain from a market that will inevitably see peaks and troughs.

At the same time, property portfolios and long-term strategies inherently suit a long-term strategy centered around a quality product and you shouldn’t be afraid to opt for quality over cost. While cheaper products may lower the barrier for entry, over time they’ll struggle against a high-quality development.