One of the things I have always been interested in is the property market. Not only do I find it incredibly fascinating, how fast the industry grows and how it contributes to the economy of the country, but I have always seen it as a great investment, and an industry worth keeping more than an eye on.
Ever since arriving in London and getting an idea of the properties around, I noticed an extraordinary thing; that property is, in essence, a money machine. Not for the tenants, of course, but for the owners mostly. If you think about it and look at property prices all around the world, both to rent and to buy, don’t you think how amazing it is that you can buy a property and in 10 years it triples in price?
The property market is growing rapidly, and those who live in Britain especially, are incredibly adamant on getting their own home. However, it is not just for the sake of having a place to live, but rather to refurbish and resell the property for a higher price (”flipping”, as it is more commonly known). This paradox of Britain’s property has always made me wonder – people don’t actually want to buy their family home, they want to make money out of it. Be it reselling or renting, it is now seen as a very reliable and easy source of income for the homeowners.
Now imagine, you buy a very mediocre house, with bad ceilings and ugly walls. You invest some money for refurbishments; amazing bathroom tiles and expensive looking kitchen appliances, you make the wall look nice and change the ceiling light for the modern ones. And BOOM! The price doubles (if not triples) in value… all you need is to cover the labor and material costs and you’ve made yourself a pretty penny, without much effort. If you also know how to do a few things yourself, this saves on labor and allows for even more profit.
If you would have come to London 16 years ago, as I did, the price for the houses were nowhere near as high as they are now. Ever since the new millennium, the prices have risen in excess of 500% on average in London according to the Office of National Statistics. The prices have increased dramatically ever since 2000 and the market has faced a constant increase ever since. As a result, property is definitely something that many are considering as a source of income, and it would be foolish to ignore the option.
I have done my own research and I can say, it does hurt your eyes looking at the prices of the houses, especially as a first time buyer. But guess what, humans, you invest in a house now, if the trend continues, you might just triple your money in a few decades – and, for all you know, just move to a nice Spanish villa with this money.