Economy
Why Should You Invest in UK Property? [2023]
Buy-to-let property investment has been a top choice for many investors over the years.
Providing regular income and considerable capital appreciation, investors will often cite real estate as being able to bring some of the best returns over the last decade.
However, is property still a good investment in 2023?
What are Investment Properties?
Firstly, what is an investment property?
An investment property is a piece of real estate purchased with the intention of generating a return. This return could be through rental income, capital appreciation from future resale, or a combination of the two.
However, as with all ventures, investing in property can get quite intensive.
So, why should you invest in UK property?
Huge Tenant Demand With Housing In Short Supply
In the wake of the pandemic, the influx of lockdowns and other mandates have led to an unprecedented change in the UK property market – making right now potentially one of the best times to invest.
More people than ever are looking to rent instead of buying a property outright, and the population in the UK is continually on the rise.
Alongside this, there’s a severe lack of supply to meet the growing demand for housing.
According to Zoopla, demand for rental property is 46% above average – with total supply 38% below average.
As the market remains so volatile, more people will likely rent instead of buying a house outright.
For example, according to the latest Housing Census data, the number of renters in the UK has increased by 28% over the last ten years.
Massive Property Price Growth for Rental Property
The most significant appeal behind investing in property is the potential for long-term capital growth.
With demand for housing on the rise, prices continue to grow – offering some of the highest returns possible in the UK.
In 2021, for example, the average value of UK property surpassed £250,000 for the first time, increasing at the fastest rate since the early 2000s. As of December 2022, the average property price in the UK is now valued at £294,329 – 17.7% higher than in 2021.
Depending on where you invest, you could see even higher values.
For example, Liverpool, one of the best UK investment hotspots this year, has seen property prices skyrocket by 18.1% in the last year, with other areas in the North West seeing similar growth.
Factoring in additional growth predictions from Savills, which anticipate up to an 11.7% price growth in the North West region and 6.2% in the UK overall by 2027, it’s clear that long-term investors could be set for a fantastic cash pay-out in the coming years.
Property Is Lower Risk Than Other Strategies
Compared to other investment strategies (such as stocks and cryptocurrency), buying property is often considered a relatively lower risk.
This is because the property market, particularly in the UK, has proven to be highly resilient during economic turmoil, making this an excellent opportunity for those seeking a more stable investment.
This is another of the significant advantages of investing in real estate and a big reason many people invest in properties.
Conclusion
As long as you have the means and know-how, you should consider getting involved with UK property investment.
The market is most likely one of the most potentially profitable (and growing) ventures to get involved with at the moment – for both UK and foreign investors alike.
If the growth rate stays healthy for the foreseeable future, barring any surprise market collapses, this period is the best point to get involved.
It is, however, essential to remember that this guide serves as just an introductory welcome to the investment process.
You will need to research and perhaps consult an expert property company to get all you can from an investment!
By Modupe Gbadeyanka
The federal government, the 36 states of the federation and the 774 local government areas have received N1.727 trillion from the Federal Accounts Allocation Committee (FAAC) for December 2024.
The funds were disbursed to the three tiers of government from the revenue generated by the nation in November 2024.
At the December meeting of FAAC held in Abuja, it was stated that the amount distributed comprised distributable statutory revenue of N455.354 billion, distributable Value Added Tax (VAT) revenue of N585.700 billion, Electronic Money Transfer Levy (EMTL) revenue of N15.046 billion and Exchange Difference revenue of N671.392 billion.
According to a statement signed on Friday by the Director of Press and Public Relations for FAAC, Mr Bawa Mokwa, the money generated last month was about N3.143 trillion, with N103.307 billion used for cost of collection and N1.312 trillion for transfers, interventions and refunds.
It was disclosed that gross statutory revenue of N1.827 trillion was received compared with the N1.336 trillion recorded a month earlier.
The statement said gross revenue of N628.972 billion was available from VAT versus N668.291 billion in the preceding month.
The organisation stated that last month, oil and gas royalty and CET levies recorded significant increases, while excise duty, VAT, import duty, Petroleum Profit Tax (PPT), Companies Income Tax (CIT) and EMTL decreased considerably.
As for the sharing, FAAC disclosed that from the N1.727 trillion, the central government got N581.856 billion, the states received N549.792 billion, the councils took N402.553 billion, while the benefiting states got N193.291 billion as 13 per cent derivation revenue.
From the N585.700 billion VAT earnings, the national government got N87.855 billion, the states received N292.850 billion and the local councils were given N204.995 billion.
Also, from the N455.354 billion distributable statutory revenue, the federal government was given N175.690 billion, the states got N89.113 billion, the local governments had N68.702 billion, and the benefiting states received N121.849 billion as 13 per cent derivation revenue.
In addition, from the N15.046 billion EMTL revenue, FAAC shared N2.257 billion to the federal government, disbursed N7.523 billion to the states and transferred N5.266 billion to the local councils.
Further, from the N671.392 billion Exchange Difference earnings, it gave central government N316.054 billion, the states N160.306 billion, the local government areas N123.590 billion, and the oil-producing states N71.442 billion as 13 per cent derivation revenue.
By Adedapo Adesanya
The NASD Over-the-Counter (OTC) Securities Exchange recorded a 0.65 per cent gain on Friday, December 13, boosted by three equities admitted on the trading platform.
On the last trading session of the week, Okitipupa Plc appreciated by N2.70 to settle at N29.74 per share versus Thursday’s closing price of N27.04 per share, FrieslandCampina Wamco Nigeria Plc added N2.49 to end the session at N42.85 per unit compared with the previous day’s N40.36 per unit, and Afriland Properties Plc gained 50 Kobo to close at N16.30 per share, in contrast to the preceding session’s N15.80 per share.
Consequently, the market capitalisation added N6.89 billion to settle at N1.062 trillion compared with the preceding day’s N1.055 trillion and the NASD Unlisted Security Index (NSI) gained 19.66 points to wrap the session at 3,032.16 points compared with 3,012.50 points recorded in the previous session.
Yesterday, the volume of securities traded by investors increased by 171.6 per cent to 1.2 million units from the 447,905 units recorded a day earlier, but the value of shares traded by the market participants declined by 19.3 per cent to N2.4 million from the N3.02 million achieved a day earlier, and the number of deals went down by 14.3 per cent to 18 deals from 21 deals.
At the close of business, Geo-Fluids Plc was the most active stock by volume on a year-to-date basis with a turnover of 1.7 billion units worth N3.9 billion, followed by Okitipupa Plc with the sale of 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with 297.3 million units sold for N5.3 million.
In the same vein, Aradel Holdings Plc remained the most active stock by value on a year-to-date basis with the sale of 108.7 million units for N89.2 billion, trailed by Okitipupa Plc with 752.2 million units valued at N7.8 billion, and Afriland Properties Plc with a turnover of 297.3 million units worth N5.3 billion.
By Adedapo Adesanya
The Naira appreciated further against the United States Dollar at the Nigerian Autonomous Foreign Exchange Market (NAFEM) by N1.50 or 0.09 per cent to close at N1,533.00/$1 on Friday, December 13 versus the N1,534.50/$1 it was transacted on Thursday.
The local currency has continued to benefit from the Electronic Foreign Exchange Matching System (EFEMS) introduced by the Central Bank of Nigeria (CBN) this month.
The implementation of the forex system comes with diverse implications for all segments of the financial markets that deal with FX, including the rebound in the value of the Naira across markets.
The system instantly reflects data on all FX transactions conducted in the interbank market and approved by the CBN.
Market analysts say the publication of real-time prices and buy-sell orders data from this system has lent support to the Naira in the official market and tackled speculation.
In the official market yesterday, the domestic currency improved its value against the Pound Sterling by N12.58 to wrap the session at N1,942.19/£1 compared with the previous day’s N1,954.77/£1 and against the Euro, it gained N2.44 to close at N1,612.85/€1 versus Thursday’s closing price of N1,610.41/€1.
At the black market, the Nigerian Naira appreciated against the greenback on Friday by N30 to sell for N1,650/$1 compared with the preceding session’s value of N1,680/$1.
Meanwhile, the cryptocurrency market was largely positive as investors banked on recent signals, including fresh support from US President-elect, Mr Donald Trump, as well as interest rate cuts by the European Central Bank (ECB).
Ripple (XRP) added 7.3 per cent to sell at $2.49, Binance Coin (BNB) rose by 3.5 per cent to $728.28, Cardano (ADA) expanded by 2.4 per cent to trade at $1.11, Litecoin (LTC) increased by 2.3 per cent to $122.56, Bitcoin (BTC) gained 1.9 per cent to settle at $101,766.17, Dogecoin (DOGE) jumped by 1.2 per cent to $0.4064, Solana (SOL) soared by 0.7 per cent to $226.15 and Ethereum (ETH) advanced by 0.6 per cent to $3,925.35, while the US Dollar Tether (USDT) and the US Dollar Coin (USDC) remained unchanged at $1.00 each.
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