Home ownership among young adults has declined since its peak in the 1980s. This could be attributed to rising house price inflation over the last three decades, as well as an increase in the number of full-time students, immigrants, and single young adults. Asset price increases relative to income have made it increasingly difficult for young adults to save for a down payment. According to an IFS survey, in 2016, 78% of young adults aged 25-34 needed to pay more than six months of their income on a 10% deposit for a median assets. Land Registry states the average house price in the UK is currently £286,397. For example, a 10% deposit for a property using this average would be £28,640 when rounded. However, a resurgence began in 2020, when the proportion of young adults aged 25-34 in the UK who own their own homes increased for the first time in more than a decade. The English Housing Survey found that 41% of young adults aged 25-34 owned a home. This proportion was only 28% in 2019. These figures show that young people are taking the lead in real estate investments and seizing opportunities in the housing market. This could be largely attributable to the pandemic, which prohibited young people from working overseas or travelling, isolating them, and providing the impetus for them to learn about the housing market and secure a house during these difficult times. The government's help-to-buy scheme was a driving factor in the development of this figure. This initiative attracts government funding, which could result in a loan to help with the cost of a new-build home for first-time buyers, a real estate through shared ownership, or a loan to help with the cost of building a home. While this scheme assists young people in getting on the asset ladder, it does not aid with investing.
Real estate investment can be a fantastic investment if the time is taken to learn about the processes and strategies involved. Many young people benefit from real estate investing because they begin early and develop good saving habits. Poor spending habits are frequently associated with young adults aged 25 to 34. 51% of this demographic spends money on general retail. This category includes take-out, alcoholic beverages, and apparel/clothing. While these purchases may not appear to have a significant impact on an individual at the time, they accumulate over time and deprive them of the opportunity to make a venture capital investment. Investing when you are young also provides you with valuable advice and lessons learned to help you avoid making the same mistakes in your investments later on. Motivation is an important factor in young adult investing success. Your youthful passion and liberation can serve as a motivator for success. In this case, the high demand for your dream home can fuel your motivation to invest. Novyy specialises in fractional investing; our "Fi-To-Let" strategy gives young adults the freedom and flexibility to invest in properties at a low entry level. This strategy will enable young people to become more involved in venture capital interests, potentially ushering in a new era of real estate investing!
When it comes to the venture capital market, the entry barrier for investors can be rather high. Obtaining the initial capital required to invest in real estate might be difficult for many people. Fractional investing allows people to combine their funds with others in order to invest in a costly asset. This can be unique since it provides investors with the same investment benefits as direct asset ownership without the associated complications. The ease and ability to sell a portion of shares is far more convenient than selling a full asset, and this is the most advantageous aspect of fractional investing. Asset fractional investing also allows you to invest in smaller increments and distribute your assets over many properties. This is useful since it enables individuals to build a diverse portfolio. In comparison to the prior year, the average house price has increased by 7.8%, according to Land Registry. As a result, fractional investing, when diversified across portfolios, has the potential to provide high annual returns due to rising asset prices. Access to higher-value properties and competitive markets in America, Spain, Greece, Dubai, and many other countries becomes possible, allowing you, the investor, to build a global portfolio.
The minimal barrier to entry is the most intriguing part of fractional investing to young adults. You don't need a significant down payment to enter the real estate market with fractional ownership. A property share can be obtained for a fraction of the cost of purchasing the asset completely. Diversification of your portfolio gives young people the incentive to gather knowledge on other global markets and their housing economy which can benefit you, the investor in the long run by accumulating the knowledge of when and where to fractionally invest. The ability to generate rental income without a significant time investment is extremely beneficial to young adults. Because maintenance and taxes are shared with other fractional owners, the management firm handles all administrative duties. As a result, young people can devote more time to their careers or other endeavors.
With a growing population of young individuals interested in the asset market but lacking the means to invest, we hope to make asset more accessible to them through our fi-to-let scheme. Our entry-level properties for fi-to-let at Novyy start around £10,000. Once this investment is made, investors will not have to worry about asset management, due diligence, or mortgage funding because we will handle all of that for them. Our revolutionary plan prioritises investor management leniency, allowing you, the investor, to go about your everyday activities while the amount invested grows over time and we take care of the other obligations. Asset investment is the safest investment option in the UK; unlike stocks and cryptocurrency, where the investment may drop or disappear entirely, assets in real estate will always exist. We seek to make fi-to-let accessible to all demographics, particularly young people who want to invest but don't know where to begin. Novyy's goal is to get them on the real estate ladder. Here is a video detailing our fi-to-let stimulus.
Young people's habits are the spark that prevents them from realising their full investment potential. Poor spending habits and a lack of knowledge about asset investing may impede these individuals during their most creative years. We hope to instil our fractional investing business model in current and future generations, providing young people with the opportunity, expertise, and resources to become asset investors in their early twenties. With the engagement of youthful investors, fi-to-let has the potential to become one of the top business models in the asset market. Through our fi-to-let scheme, we hope they can make fractional investment a healthy habit and teach future generations how to be successful.
Novyy is a Digital Investing Platform that enables individuals to invest in UK Buy-To-Let, Leading Real Estate Private Equity, and Premium Properties across Europe with as little as £10,000. Novyy users enjoy seamless digital investing like never before, in opportunities that were earlier unavailable to most individuals. This piece should not be construed as tax advice. Please refer to your tax advisor before making any decisions on owning properties through Limited Companies.