Alternative Investment Opportunities in the UK
Investing is hard enough at the best of times. You need to make sure you have done your research and due diligence on any product you look to invest in, and this takes time. Information and knowledge is the only way to make investing work for you.
You can invest in almost anything these days with the majority of people sticking to property and the Buy to Let market. Mainly because anyone, if they wanted, can pick up enough knowledge relatively easily around the property market to make a savvy investment.
However, with stricter regulations and less tax breaks now available for landlords, many are looking at alternative investment opportunities. Something to help diversify their investment portfolio. Below are just a few investments which we think have started to become a little more mainstream over the last few years. Have a read and see what you think.
1) Fine wine
Considered by most investors to be immune to the volatile stock market, the value of wine has grown considerably since 2013, with an even steeper increase of 20% in 2017. As with any investment, you need to know your stuff. For wine, it is vital to understand the basics such as the quality and character of each one. Fortunately, most of this information can be taken from a vintage report. In the report, everything from weather reports to harvest conditions can help dictate your choice of wine to invest in. Studies suggest that you start to turn a profit at around year 5 and can expect a steady return between 6-15% annually over the longer term. So be prepared to play the long game. As we said before, know what you’re investing in and wine could help you turn over a tidy profit.
This is one alternative investment opportunity to keep your eye on!
2) Parking Spots
Another alternative investment opportunity gaining traction in recent times are parking spots. Whether it is in long stay airport car parks or individual spaces. Cark park spaces can typically be bought between £25,000 – £35,000 for a six-year lease and most offer a guaranteed rental yield of 8% for the first two years.
The thinking behind the idea of buying a car parking space is that numerous motor organisations say there will be an added 39 million more vehicles on UK roads by 2030. Add that with a finite amount of parking space, demand will comfortably surpass supply. Most investors currently purchase an individual space and lease it out to a tenant. Often this tenant is a management company which then sub-leases it to customers on an annual basis. This might not have been one alternative investment opportunity you had in mind, but one to scope out with the changing vehicle market.
3) Hotel rooms
Hotel room investment gives you the opportunity to buy into a high yielding industry at a fraction of the cost of owning an entire hotel. And it’s a pretty much hands-free investment. You buy it, the hotel manages it, from bookings to changing sheets, they take a cut of the profit from the room but the rest is then yours. Demand for hotel rooms has been consistent nationwide for years now. And this is where your knowledge of the market comes into play. London tends to have higher occupancy rates by around 5% – 10%. However, the yield per room produced by regional hotels outstrips London. But again, neither of those things are the worst problems to have. At the end of the day, it boils down to personal preference.
Select a popular destination. Choose a hotel that has good management services. Buy this investment and start receiving your income.
4) Alternative property investment
Property investing is the most popular investment as it is accessible for pretty much everyone. It’s relatively easy to understand and plenty of easily digestible information to help improve your knowledge of the market.
Property is traditionally a very safe UK investment opportunity, but this is changing due to Brexit uncertainty and new tax rules. The Buy to Let market in recent years has been significantly impacted. But this is not to say there isn’t money to be made from property.
Fortunately for us, interest in Life Tenancy investments has grown consistently with many Buy to Let Landlords using us to help diversify their portfolio and become their alternative investment opportunity of choice.
To read more about Life Tenancy Investments here.
To stay up to date with all available and upcoming Life Tenancies, register here.