Working with round numbers, where would you invest £100m if you wanted to buy up to 1,000 properties with a yield based approach? The intended hold period is 1,000 years so no need to worry about exit plans in you or your immediate family's lifetime. Taking the long view and sticking to the UK, including Scotland for now, what 10 cities would make your list?
The idea that Scotland will still be in the UK and still using Sterling for another 1,000 years is open to debate but as there is no way of knowing what will happen, let's keep Scotland in. So, England, Wales, Scotland and Northern Ireland are included. What are the top 10 cities which a BTL investor should focus on? London is likely not to be heavily weighted in the mix. Buying in London or other cities where capital values are high compared to rental income would drag down results given that yield is the focus. That said it is very hard to pick cities that will have staying power over the entire term. London has been the largest city in the UK for over 500 years. The 2nd largest UK city has changed multiple times over the past 500 years. The UK itself was not even in existence a few hundred years ago.
If you are thinking the above is all a bit ridiculous, a UK REIT is designed to focus on yield. As an investment vehicle, investors in a REIT can buy and sell their shares daily so the company never needs to sell the properties. Holding very long term removes most of the risks of picking badly.
The biggest driver over the long term is the result of supply versus demand. Yes, it is that simple and you did not have to buy an expensive course to learn 'the secret'!