Why are Property Bonds growing in popularity with investors and developers?

With us living longer, pension funds are not giving many of us the financial future we planned for, and other ways are often sought to grow financial nest-eggs to top up that future income. Bank savings accounts aren’t delivering on that either…

So is there a place in a portfolio for Property Bonds – for those of us that would rather be the lender than the property developer?

With good Property Bonds, you team up with an established property developer in a Joint Venture. But there are none of the set-up costs for the bond holder that you would normally associate with a direct property development project, or the advisor fees that come with buying traditional regulated investments: all of your capital goes to work for you.

Here are a few other key reasons to consider profiting from Property Bonds:

  • Property is seen as a secure asset class and with not enough homes being built in the UK demand continually outstrips the supply.

  • There are more and more obstacles in directly owning investment property. Heavier taxation for residential investment property and reduction of tax reliefs for expenses; difficulty in raising mortgage finance for buy- to-let; dealing with tenants; licensing; regulation, the possibility of rent controls; the list goes on). Many property investors are looking for less hassle and more profit: being the lender, not the landlord.

  • As part of this movement, investors who are cash-rich and time-poor are looking to partner with developers by lending rather than getting directly involved in the day-to-day running of projects.
  • In uncertain economic times a predictable fixed income for a known period of time has much appeal.

  • Whilst no investment is risk-free and they’re not for everyone, a well-chosen Property Bond can offer credible security and a practical exit strategy should things go wrong with the developer.

Learn how to spot a good property bond, and those to avoid. All this and more is covered in our Property Bonds guide – grab your copy today:

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