The Best Way to Invest 100k in the UK

Depending on the area you choose to purchase property, £100k is enough for a substantial deposit towards an investment property or even more than one, if your financial situation allows. Bear in mind that the deposit is just the first step on the journey of property investment – you will need additional funds for mortgage payments, insurance, and maintenance costs as well, although ideally, you will start generating some income that will go towards these too. You can also invest money in property through a real estate investment trust, or REIT. Here are some ways that you can invest 100k in property in the UK:

Buy-to-Let

You can use part of your 100k to put down a deposit on a buy-to-let property, or more than one depending on the location and what kind of mortgage deal you have access to. You can then use the rest of the money to make improvements to the buy-to-let property to attract good-quality tenants and earn more money from renting the property. Look for properties in areas where rentals are in high demand like large cities or places near universities. Have an exit strategy in mind too – build up equity in the property and then you can sell it for a lump sum, or hold onto it as an income-generating asset. 

BRRR Method

The BRRR(R) method is a popular way of investing in property. It stands for Buy, Refurbish, Rent and Refinance. It involves buying a property usually at below market value, refurbishing it to bring it in line with other rental properties and adding value by replacing assets like the kitchen and bathroom, renting it (this part is optional but can generate some additional income) and then refinancing, i.e. borrowing more money based on the property’s increased market value. This can be repeated several times, increasing profits and income along the way. 

Serviced Accommodation 

Serviced accommodation means offering similar services to a hotel but in a self-contained apartment or house, e.g. cleaning and housekeeping services. This attracts tenants who may be staying in an area for a few months at a time, perhaps for work or other commitments. Serviced accommodation can attract high-quality tenants and higher rental yields than typical residential lets, but does involve more work as it is more of a service business and clients have higher expectations. You could use some or all of your £100k to invest in rent–to-rent serviced accommodation and use some of the money to provide the high-end furnishings and facilities that tenants will expect.

Holiday Lets

Holiday lets are a solid investment strategy, especially if you have experience in this field. Holiday lets are houses or apartments in popular holiday destinations, which could be in coastal towns, in large cities like London or other popular tourist locations. Using 100k could be a good way to invest in holiday lets, as mortgage lenders may ask for a higher deposit than residential or buy-to-let properties.