HOW CARE HOME INVESTMENTS OFFER A PASSIVE INCOME FOR INVESTORS - first-uk-properties

In the world of property investments, care homes are a relative newcomer, but what can’t be denied is that this growing array of offers providing an attractive passive income. At the same time as offering an investment in the future and wellbeing of our elderly loved ones, care homes exist in a market that’s naturally being buoyed by the steadily increasing life expectancy of UK citizens.

One of the main selling points of a care home investment is the fact that a passive income can be achieved whilst also offering the added benefit of capital growth of the property itself. Figures from the Office for National Statistics (ONS) show that over 18% of the population in the UK is over 65 and by 2044, this is expected to increase to 25%.

Of course, this growing elderly population needs to be catered for, which naturally means that the demand for long-term care home facilities is also increasing. Studies show that over the next half century, the number of care home beds needs to rise by around 50% to keep pace, so there seems to be little doubt that places in this kind of facility are highly sought-after and becoming more so every day.

At the point of writing, hospital beds that are occupied by seniors cost the NHS up to £250 each day and when there are no available care home beds, they’re unable to move them on. The need for more care homes in the UK going forwards is undeniable, meaning that it’s a sector with huge potential for investors as it’s pretty much guaranteed to be financially viable.

The backdrop to this situation is an elderly care sector that has seen consistently underfunded from the public purse in recent years, with around an 18% drop occurring in the ten years between 2005 and 2015. Whilst this underfunding is unfortunate, what it does do is open the door for any private investors looking to get on board in a sector that is set to significantly grow.

In fact, care home investments have continuously shown themselves to be a sustainable and profitable asset class - outstripping other UK property avenues by a factor of 2 or more. These robust returns illustrate that the risk to reward ratio is very much stacked in favour of the investor, which is why more and more savvy profit-seekers are turning to the investment opportunity.

Another of the reasons why care homes represent such a great investment opportunity is that they manage themselves and offer the full ‘hands off’ experience. Your investment will be fully managed by the operator of the care home, so all you have to do is sit back and collect the rental payments as they come through. What’s more, the income is immediate.

The fact that the care home in question will be fully managed and maintained means that you never have to worry about the upkeep - as it’s all included and taken care of by the operator. Anyone who’s ever invested in other types of UK property will tell you that maintenance and upkeep is something that often eats into the income it provides.

If you’re looking for an investment that can provide you with a residual income well into your retirement, then care homes most certainly fit the bill. The rental yields are so impressive that many people simply choose to leave their money in place and reap the rewards year after year. Some savvy investors even choose to invest in retirement homes so that they can themselves move in when the time arrives.

Occupancy rates are guaranteed to remain high, as we’ve seen, so it’s an income that can be relied upon. This difference is profound when compared to commercial and residential investment opportunities that don’t come with anything like the same degree of certainty when it comes to finding tenants.

The available passive rental income return on care home investments are far in excess of other types of UK property opportunity, as we just mentioned - but what are we actually talking about? Well, with First UK, for a £75k investment you’ll receive an 8% return in the first year, 9% in years 2 and 3 and an impressive 10% in years 4 and 5.

If you’re able to invest more, £150,000 offers you a strong annual 10% return from the get-go and then with the ‘Guaranteed Buy-back’ scheme, you get a fixed price to allow you to plan your exit strategy when the time comes, be it a year 3, year 5, year 9, year 15 or year 20. The longer you can leave your investment in place, the more you’ll make, with this buyback feature being optional.

As you can see, you don’t have to research the subject too extensively for it to become obvious that care home investments represent risk-free returns at a level that other opportunities simply can’t compete with. At First UK, we’ve been assisting clients to take advantage of these high returns for many years and you could be next.

Moving forward on this type of financial commitment can be daunting and more than a little overwhelming, but when you see just how much potential growth there is in the sector, you realise that the odds are stacked in your favour. Of course, you always need to do due diligence with this kind of thing, but with the right expert assistance, the rewards are there to be grabbed.

So, if you’re thinking of getting involved in care home investments, then the First UK would certainly like to hear from you. Our friendly and professional experts are on hand to show you exactly how easy and stress-free life-changing financial investments can be.

That’s it from us for this time. Check back with us soon for more tips, news and advice from the world of high return property investments.

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