We have made mention before that currently the Mortgage review has affected those applying for residential properties only and that buy to let purchasers investing in property do not necessarily have the same restrictions. The “ help to Buy “ scheme demand appears to have the effect of increased competition and therefore prices which has in many cases lead to young people being priced out of the market.
So is buy to let the main reason to buy property?
Residents in the UK have a tradition of buying property. There is a view for some that a tangible asset is the safest form of investment and for many that is bricks and mortar i.e. property. Indeed in some cases where young people are still keen to invest in property but feel priced out of their desired areas in the UK. Some individuals are therefore looking at overseas, this however, can be higher risk not only with management but in understanding legal matters taxation etc. The majority of UK property investors however are investing in UK buy to let property.
Recent headlines in the Telegraph reported that “one in five homes now owned by landlords” and that this looks set to continue. Recent pension reforms have given people more freedom with their pensions and many remain concerned by the previous problems of pension companies such as Equitable Life and so are turning to back to the more traditional bricks and mortar buy to let investments
Today’s buy to let investor can look at their motives for investing in property and then identify the right property that matches their motives expectations and also lifestyle. For those not looking to be actively involved in the properties then a number of “hands off” or “passive” investments exist such as the student properties that offer good yields. Some are choosing to shift the balance of their income away from say employment to the property portfolio and so are concentrating on the net income levels produced by the property
UK Government’s figures suggest that by 2032, more than one in three properties will be owned by private landlords. Reports from Paragon mortgage lenders suggest that there are around 2 million landlords in the UK renting out around 5 million properties. Reports suggest that the number that proportion of the rental sector supplied by private landlords is approximately 18%. With demand set to continue leading to excellent levels of occupancy and rental prices then this sector is set to grow further.
There is a note of caution not all properties are a good buy to let investment and the potential buy to let investor should look at relevant research regarding the property management and potential of the property for the future. Investment Property Consults have considerable expertise from many years of assisting landlords and would be happy to assist any investor seeking a buy to let opportunity.