Why Invest in Property Loan Notes?
Property Bonds are becoming extremely popular for traditional buy-to-let landlords as well as individuals looking for a way into the property market. They are a great way to diversify your portfolio without having the hassle that comes with outright ownership and running costs a typical residential property would. They provide fixed returns and gives investors the opportunity to invest in numerous different property assets such as traditional residential apartments to commercial developments over a short period of time. When it comes to the returns, interest is payable every 6 months, but if you want to make a little bit more from your investment some opportunities offer you the chance to defer your income after the investment term, allowing you to profit from further interest available.
Taking the above benefits into consideration, and knowing they are low entry investments, this opens the doors and offers more opportunities for individuals to growth their savings and increase their overall income returns. The property market has always been a popular choice for investment and by taking away the headaches a landlord might suffer with gives you the best possible investment from a property bond.
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What are the pains in property?
When it comes to being a Landlord, there are many factors to consider if you’re stuck for time. Unless you are fully managing your own portfolio, it can become quite expensive and also tricky to enjoy the benefits property can give you. Below are just some of the key points that you wouldn’t have to worry about when investing into a Property Bond;
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No stamp duty payable
No management fees
No running costs
No ground rents
No service charge
No upkeep costs
No problems with tenants
No void periods
No need to sell
No legal fees
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As the returns in Property Bonds are fixed, it’s also a great way to know what income you’re achieving from your investment over the bond term which offers more peace of mind. By taking away the pains of the industry you’re left with a strong opportunity to get into property and by simply benefiting from the interest returns on offer. At the end of the term, you simply receive your invested capital back.
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These are just some of the many reasons why property bonds can be a better investment for one to consider instead of buying a property outright.
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Of course, it is extremely important to carry out your own due diligence before investing into any property bonds so please ensure that this is something you investigate. A strong property bond will also come with a legal charge over the company’s assets providing the bond. This is something you should look out for as it ensures the assets can be sold on should there ever be a default and allows you an opportunity to receive your invested funds back.
If you are unsure about this, we would always recommend speaking to a Financial Advisor about any opportunities you are looking at to ensure they meet your criteria and expectations. Property is an unregulated asset class therefore Property Bonds also fall within this category. So please ensure you’re eligible for any Property Bond you’re looking to invest in before proceeding.