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UK Investing Habits: Balancing the Yield of Today with the Growth of Tomorrow

It’s no surprise that “Investing for the future” and “Making money” are the number one and number two reasons for investing in any area but according to independent research by CensusWide the top 5 things people want to invest in are:

  1. Property 40.3%
  2. Land 20.9%
  3. Gold 19.6%
  4. Stocks 15.8%
  5. Shares 15.5

There is a clear divide between preferred investments and actuals with ISA’s being pipped to the top 5 at 13.6%. This preference for property, land and gold investments represents a strong need for tangible, real-world and potentially less volatile investments for future planners and those seeking to make the most of their own retirement.

Yields and Capital Growth must be considerations wherever you’re investing – especially in property – whilst short-term so-called “flippers” are increasingly finding it difficult to find the right flip, those with time to allow property values to grow over mid-term periods can reap the benefits of both annual yields and long-term capital growth.

For example – investing £50k into a property, off-plan property or otherwise – with a mortgage on the remaining could allow the investor to not only expand their capital through market growth but also create long-term passive income post mortgage term. Factor in small yields through rental income and there’s a clear pathway to generating a comfortable retirement, nest egg or even inheritance.

Repeatable, scalable and importantly accessible to the majority – whilst all investments carry their own risks Property consistently delivers growth over the mid according to the Office for National Statistics (ONS) showing a whopping 50% growth from 2005 – present:

Average UK House Prices

Capital growth as above may be the primary goal for some investors, especially those in the South East who’s appetite for making money through property investment topped our responses with 37% citing this as the primary reason for investing in property. Yields however whilst not as headline-grabbing as 50% capital growth can’t be overlooked – 6-7% yield practically applied, can either provide shorter-term passive income whilst protecting capital in bricks and mortar for interest-only mortgages or help savvy investors to repay any LTV for capital and repayment mortgages. Ultimately balancing the benefits of time and capital available with financial goals.

Protecting your own future

So where does this leave you and your family? Are you sipping coffee admiring the lawn on Monday morning or trying to make the most of state pensions? One of the 60% of UK that have started to invest for their future or part of the 40% that haven’t?

Everyone starts somewhere, and every investor seeking to build wealth for retirement, family security, inheritance or to achieve financial freedom – whatever your reasons having a clear plan and trusted partners is key. If you’re one of the 40% of investors looking to make the most from Property we’ve shared 5 of our best below – mixing off-plan new builds for maximum Capital growth with ready to let opportunities for short term rental yields. We’ll see you on the lawn.

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