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The Age Old Question: Capital Growth Or Yield?

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Published: 01/08/2018   Last Updated: 17/10/2018 11:21:26   Tags: Capital Growth, Yield, Buy To Let, Property Investment

Landlords and investors never tire of this debate. Everyone has a slightly different take on it, and your approach should also fit your personal circumstances. Where you stand on this spectrum will depend your attitude, knowledge, experience, and risk profile.

Should I go for yield (or cash flow) or capital growth?

I get this question a lot. In fact it’s one of the most asked questions I do get. The most common chestnuts being ‘Where do I buy’ or ‘What do I buy?’. If I had a pound for every time I had these…! (I’ll cover these in a separate blog, read on!). The answer is – it depends.

You’ll need to be clear on a few things before we get going and buying the first property we see that we like the look of!

What are you trying to achieve? Why are you investing in property in the first place? What are your long term goals? What are you going to do with the cash flow?

We need to understand what your strategy is first. And if you don’t have one, you need to get one! Don’t spend any money until you have got this nailed.

Let me illustrate with a couple of examples.

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