Due to various reasons, the property market in the UK has shown various ups and downs. You take any place in the country, some have performed exceptionally well, and some did not.
Cornwall, the calm and serene town is famous amongst the tourists for its superior natural beauty. However, statistics show that it has been popular amongst the property investors also.
Those who wish to own a second home at a place where they can go and stay for a couple of weeks must consider Cornwall.
It is one of the best choices indeed.
Whether it is an equity investment or debt, you must be cautious and alert.
In the equity investment, the investor is the part owner of the property and shares both risks and rewards. The equity investor gets priority on the percentage of profits before the developer.
As far as a debt investor is concerned, he gives a loan to the property developer. The developer agrees to pay an agreed rate of interest along with part of the principal amount every month.
Which one is better when you invest in Cornwall?
As far as the return on investment is concerned, the equity investment gives higher returns whereas the debt investment gives relatively lesser returns.
However, the risk in a debt investment is lower because the debt investment will be recouped by selling the asset if the project doesn’t reach completion.
On the contrary, if a project is very successful, then the equity investors will share the success and receive higher returns than anticipated.
In case of debt investment, the investors receive a fixed amount if interest regardless of the surge.
In Cornwall, you can find both types of property investments. You should check the property, investors and overall performance of the local property market.
It will give a fair idea of where to invest in Cornwall.
The property market in Cornwall has performed remarkably well in the past, and experts believe that the trend will continue for some more time.
Hence, there is a lower risk regardless of it being a debt investment or equity.
Follow the due diligence
Property investment always carries a risk, whether it is in London or Cornwall. When you buy a property where you don’t live, it is furthermore important to check everything thoroughly. Do your due diligence before making the investment decision.
Every property owner or landlord is supposed to assist the buyer in performing the due diligence. Complete transparency should be followed in the process. It helps in the decision making.
If you find it difficult, then hire third-party assistance for it. Professional service providers can carry out the important processes such as AML (Anti Money Laundering) and KYC (Know Your Customer) credit checks.
The third-party services meet with the developers to understand their background, experience in the niche and motives. Their representatives visit the property and arrange independent valuation or survey if required.
When you invest in a place like Cornwall after proper investigation and research, there is hardly any possibility of error.