Traits of a successful property investor in 2020 – Part 3

Chris Street

19th April 2017

traits of successful property investor in 2020 from Optimise Accountants

By Louise Misiewicz

How will successful property investors operate in 2020?

What are the key traits for successful property investment?

I’m writing a series of blog posts on what will be required to be a successful property investor in 2020.

You can read the first week’s blog instalment here.

You can read Part Two of this blog series here.

Last week’s blog article discussed the benefits of diversifying into EIS for a more diverse and robust mix of investment opportunities. Our team of property tax specialists can advise you further on this.

I’m convinced as 2017 continues that the requirement for savvy property investors to consider additional revenue streams and investment options will become a key factor in the ongoing profitability of portfolios.

What is the third trait required for successful investment?

The third trait a property investor will need to adopt in 2020 will be the need for property investors to operate as professionals – the easiest way to do this is by operating through a Limited Company.

My team and I have worked with thousands  of property investors in recent years, and the stability and structure afforded by working through a Limited Company set up are well worth considering.

I wrote a useful blog here recently about the elements to consider when setting up a Limited Company. This will provide property investors with an excellent starting point, and a checklist of items to review.

Does operating as a Limited Company make a big difference?

I also wrote a detailed article here on why a Limited Company might be the best structure for tax purposes and wealth planning. There are certain tax liability advantages which this article examines for readers.

There are other articles to read which will also provide useful background reading when considering the benefits of a Limited Company structure for a property investment portfolio business, including:

Paying yourself out of a Limited Company

The tax implications of changing to a Limited Company

Loans between Limited Companies for property investment

It’s worth remembering that there are many property investors who are using limited companies in the wrong way. They are mixing up trade activities with investment holding companies, which have dire effects on IHT planning

There are also some property investors who have more than three Limited Companies, because they have set up a Limited Company for each property deal or joint venture they’re working within.

I’d advise against this practice – get in touch here for an informal and no-obligation discussion.

For example, if you’re thinking about setting up a Limited Company to do property flips (buy then sell properties) then you may need to consider whether you need to be Construction Industry Scheme (CIS) registered.

If you are buying properties to sell and making changes to them, read this article to work out where you stand on CIS. You can also contact me and my team of property tax specialists to review your position.

Next week’s Part Four of this series will examine the next trait – riding the wave of growth in buy-to-let.

How to engage with us

If you want to understand how to implement this strategy or to discuss other finance/tax questions then please book some time with us using the below calendar.

Please use the redeem code “Article 33” to get 33% off your next consultation call.

If you are looking for a new accountant, then please book some time with us using the below calendar.

Please note that this booking is to describe our services and will not be used to discuss your personal tax affairs.

Book a call to see how we can help you.