How To Invest In Property in the UK If You Win The Lottery

by | Feb 16, 2021 | Finance

Everybody wants to win the lottery. Everyone has dreams of what they would do with their money if they were the lucky winners. Some want to help their families and leave money to their grandchildren. Some want to travel the world. Others want to live in a castle and dress in the finest clothes. They want to walk dogs wearing diamond dog collars. The fact is, that is what winning the lottery does. It allows people to live out their dreams, no matter how crazy it may seem to others.

Still, there is one thing every lottery winner has in common. None of them want to run out of money. Even billionaires can run out of money if they lavishly hand it out, and nothing is coming in. This is why lottery experts such as industry giant Lottoland refer their winners to financial advisors and legal experts before they collect their winnings. These experts also check back with them in a few weeks to ensure they understand the importance of investing money for their future.

Financial advisors agree, one of the smartest investments a lottery winner can choose in the UK is property. In this post, we are going to share some information on how to invest in property if you win the lottery. Of course, even if you are not a millionaire, you can still invest on a smaller scale and you will find investment property done right provides a good return on your investment, no matter how large or small.

How involved do you want to be?

A lot of people immediately think “landlord” when they think of buying property. That is certainly one way to go. But it is not the only way to go. There are two ways you make money from property. There are several ways to get there, but the bottom line is this, you make money from renting your property to other people or from buying property and selling it at a higher price than you bought it for. We will go through a few of these methods of property investment. In each, you will need to consider how involved you want to be.

  • Buy-To-Let

This is buying a house, apartment, or residential home with the intention of renting it to other people. You are responsible for the maintenance, taxes, insurance, and required upkeep (such as heat and water) of the house and the renters are responsible to pay the rent on time and keep the home clean and in good repair. If you have good tenants that pay on time. The income the home generates replaces the investment and when the value of the property has increased (which it will if you did your research and bought in an area of growth) you can sell it for far more than you have invested in it. If you do not want to handle the rent collection, maintenance, and other matters, you can hire a property management company to handle the day-to-day business for you.

  • Real estate investment trusts (REIT)

It is not unusual to see real estate investment trusts listed on the stock market. They are an easier way for people to invest in property. They have been around since 2007.

The reason they are so popular is at least 75% of the profits are required to come from the rental profits, not the building itself. Since the rent can be predicted well into the future, it makes buyers who are a bit more inexperienced more comfortable investing.

Also, they are required to distribute 90% of the property rental income to investors as dividends. Investors begin getting paid faster and in good amounts, which makes this a very attractive investment.

A new investor should seek the help of an expert before deciding what kind of REIT you should invest in. You may opt for a diverse portfolio with different types of property. Some investors stay with one or two types. There are private homes (buy-to-let), commercial offices, warehouses, and spaces for manufacturing, e-commerce clients, and retail locations. This would include shopping centers, monster malls, or mini-malls. Of course, just because you buy a mega-mall there is no guarantee that the sales will not drop off as they have in recent years. It pays to be careful and to let the experts help you.

Since you won the lottery – you can afford it!

People who have money sometimes do not want to spend their time playing the market. They want to jump right to the big games.

These investors look to get with other investors in a private property fund. They pool their investors’ money to buy real estate, managed by a team to which they pay an investors fee plus a portion of the profit for their trouble. This investment is costly and the return is slow. Only those serious enough to put in a large amount of cash who are willing to wait for it to grow can afford this type of investment.

Maybe you are looking for a way to invest several thousand dollars or just to turn your savings into a bigger nest egg. Or maybe, you won the lottery and you want to make sure you will never have to worry about your bank balance ever again. Investing works for both situations. Anyone can find a good investment if they take their time and only invest money they can afford to. It is never too late to start. Call your financial advisor today, and then get online and grab your lotto ticket!

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