Alison Wiles from 1st Associated Independent Chartered Surveyors says:  There are two types of property, house and home house is an investment.  Sometimes people think they are both but there is very different criteria when you are looking for a property as an investment.

There are two types of things you are looking for in a property as an investment – capital growth which is the property value going up or an income stream from letting or renting, which is the profit you have left from your rent once you have paid various bills.

Investment property capital growth

Let's look look at historic information and what the market has done in the past.  This is available from the Halifax website and Nationwide website.  This shows how the market has gone up and down over the years, for example in the 1970s there was a property boom said to have been caused by the way the mortgage lenders lend money to everyone when it changed, and allowed people to borrow more which is a supply and demand growth.

Then we had the property boom in the late 1980’s. This really is all about opinions.  It is always said that the real profit in property is always from the capital growth.  For example, in the mid 1990s if you had ten houses each worth 100,000 (typically house prices have gone up 60 to 70% over the last five years).  Your 10 houses worth a million would now be worth one and a half million - not bad for doing next to nothing!

Its just a case of buying at the right time but that's easier said than done.  They usually say the key to buying property at the right time is not location, location, location its research, research, research. Come on one of our couses to find out more Property Courses

The other way you make profit out of property is by having properties with an income stream such as a rented house.  Lets take one rented property with an income of £1,000 pounds a year, you will need fifteen houses to have a reasonable income.  So if we use fifteen houses at £100,000 each this will give you an income of £15,000.  However, to purchase fifteen houses assuming £100,000 each as above example you will need 1.5 million - so not the best way to spend your money and again there are far cheaper ways of doing this, we refer you to our course above.

For further information and advice phone 1st Associated on 0800 298 5424 or visit www.1stAssociated.co.uk