Investment Oportunities

Investing in property is safer than the stock market and can generate income as well as secure capital, writes Mary Wilson

"The property market may not have the liquidity of the stock market, but it is less volatile. And bricks and mortar have generated consistent yields year on year.

"This time last year, I was about to put all my investments into the stock market, in particular an assortment of dot.com companies," says Suzanne Coker, who runs a successful public relations company and lives in the Cotwolds. "Watching what was going on in the stock market, I got very nervous and deliberated for weeks about whether I should buy a house or put my money into shares. Thank goodness I opted for bricks and mortar."

Another important advantage property has over equities is its ability to increase your rate of return. "If you put £100,000 into equities, historically this will perform well over time, but if you borrow two or three times that amount and put it into property, you can do much better," says Hugh Obbard of property investment company Hugh Obbard & Associates.

People are increasingly turning to property as an alternative to annuities and personal pensions. The rental return provides the pension income, and as long as they buy well and invest in good quality property, they will see capital growth too. "But you must stick to quality prime areas that have a proven value," says James Wilson.

Unlike equities, property is also a tax-efficient way for people to pass on money to their children. It also has the advantage of being a tangible asset. When equities are looking exposed, as they are at the moment, the tendency is to turn to things more tangible. The only problem with property is liquidity. If you need to get your money fast, then if it is in equities you can trade, just by a click of a button. Property is never that simple.