Nubricks Blog - Ever lost sleep about your future retirement income?

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05 Dec 2017

Ever lost sleep about your future retirement income?

Retirement is one of those things that nobody seems to tell you about until it’s too late – or at least, you are unwilling to listen until the imminent importance of pension planning suddenly creeps up on you.

There is nothing more unsettling than having to worry about your financial security after you stop working and thus investing for this time can be a nerve-wracking experience.

This isn’t helped by the fact that “mainstream” investing is not really what it used to be. Savings accounts and ISAs offer meagre returns of 1-2% and managed investment funds oaround 3.5%. At the same time, stocks and shares offer little of the stability that so many crave at this time – retirement is certainly not a time for taking a punt.

If only you could cast of some of this risk to someone else

Property has always been one the most valued investment assets, with people enjoying the enhanced security of owning something tangible – as opposed to shares in a company.

Recent legislation, however, has made buy-to-let property investing more hassle than it’s worth in the vast majority of cases. Nobody wants to retire only to have to work full time to simply maintain themselves in retirement.

Luckily, there is a new approach to owning property, while avoiding all of the usual effort involved.

Serviced apartments are classified as commercial property, with the sector among the fastest growing in the UK. This rapid growth has coincided with ever-increasing tourist inflows, with the UK now the 7th most popular tourist destination globally. On top of this, visitors to our little island have spent more year on year for the past decade – with record levels again projected in 2017.

At the same time, people’s travel accommodation preferences have changed – with many preferring the home comforts and cost-effectiveness of serviced apartment over hotels. This is evidenced in the rising occupancy levels in serviced apartments, which overtook hotels for the first time in 2016.

You can own one too

Many of you will have heard of, or even stayed in a serviced apartment. Websites like AirBnB have increased exposure to this accommodation approach and many people now avoid hotels altogether.

You may not, however, have previously been aware that you, as an individual, could own one ofthese serviced apartments – but you can.

Indeed, serviced apartments can be owned just like any other residential property – with the additional perk of onsite management removing all the hassle and stress.

Further to this, such investments often come with up to 10 years of fixed income – meaning that when you purchase your property, you are aware of exactly how much revenue you will receive directly into your bank account each year.

This type of management is made possible by the large number of units present in each development – something which provides beneficial economies of scale with regards to the purchase, maintenance and management of your property.

The perfect retirement investment

Stability, ease and profit – these are three words that all pension plans should definitely include.

With serviced apartments, you are able to make up to 12% NET income without ever needing to set foot inside your property.

This frees you up to pursue other interests elsewhere - whether investment or leisure focused.

Category: Blog

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