Landlords - should you invest for income or capital growth?

I've recently come back from looking at two rental properties that are shortly going to auction. Both are highly cash generative with prospective net yields of near 10%.

What it reminded me of is that landlords looking at property to invest need to be clear about their objectives for their properties before taking the plunge. Are you looking to:

1. Buy for income and maximum yield?

2. Speculation on long term capital growth?

3. Looking to add value through improvement or development?

Before you start looking make sure that you are clear what your primary objective is. There may be secondary reasons but landlords should know from the outset what their primary driver is for property investment.

Have a look at the feature on cashcows and trophy assets. Looking at the recent Halifax research on house price booms we look as if in this decade of the terrible / turbulent / traumatic TENS then buying for capital growth alone may not be such a good call. In my view we are likely to be entering a decade where highly income generating buy-to-let investments perform best

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