You can invest in property directly or indirectly through a 'pooled' or 'collective' investment scheme, like a Unit Trust or Open Ended Investment Company. Property investment carries high risks.
Direct property investment
Buying your home or a property to let out is a way of investing directly in property. However, although the Financial Services Authority (FSA) regulates most mortgage sales, it doesn't regulate most buy-to-let mortgages. If you're thinking of investing directly in property as a way of making money it's important to be aware of the risks. In particular, beware of 'get-rich-quick' promotions.
Indirect property investment
Property Open Ended Investment Companies (OEICs) and Property Unit Trusts are schemes which pool investors' funds into one fund which invests as much as possible in property. (The fund invests either directly and/or by buying shares in companies that invest in property). A few of these schemes are regulated, so there are safeguards to reduce the risk of financial loss.
Collective investments that include property
Some unit trusts, OEICs, investment trusts and life assurance policies include property in the range of funds they invest in. But they also include other investments (shares, government bonds, cash etc) to spread the risk. Some of these collective investments are regulated by the Financial Services Authority. Their marketing material will tell you which range of funds they invest in.
Getting financial advice
Property investment carries high risks. It's a good idea to get financial advice before investing in any property scheme. To find out how a financial adviser may be able to help, serch in www.google.com "Property investment financial advice" I am sure you will find a really good financial advice company.
Monday, 27 August 2007
Investing In Property
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4 comments:
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property investment funds
Of the five different areas of investing your money, after cash comes property. Many people believe that the property they live in is their biggest and most important investment. Whilst this may be true, and is true if you have no mortgage, it isn't really your property as long as you have borrowed money to buy it.
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