Research conducted by online letting agents has indicated that over half of landlords in the UK are planning to expand their property portfolios in 2015. 2014 has been a strong year for the buy-to-let market and with the trends of the last 12 months showing no signs of slowing, landlords and letting agencies alike are rightfully optimistic about the expected benefits of further investment.
That optimism has partly been the result of a substantial growth in demand for rental property. This has led to a market in which landlords are suffering less from tenant arrears, while enjoying a rise in rental prices. Those that have made use of Pure Property Managements robust tenant referencing and credit check service and have been able to pick out the most trustworthy tenants will have found themselves particularly benefiting from this trend. A Rent Guarantee makes all the difference!
Online surveys reported that, over the last 12 months, these factors had led to 50 per cent of landlords attaining yields of between 6 per cent and 8 per cent, while 10 per cent of landlords found themselves achieving yields in excess of 8 per cent. 40 per cent of landlords reported achieving a 4 per cent yield. In equally welcome news, rising rental prices are creating a similar rise in equity, with almost a third of landlords attaining a loan-to-value ratio of between 30 per cent and 40 per cent.
Naturally enough, landlords are currently far more eager to buy than to sell. Intent on capitalising on the upswing in buy-to-let property value, only a quarter are planning to sell theirs during the upcoming year.
Pure Property Management reported a growth in rental demand, with only 3 per cent of landlords indicating a decrease, so it certainly seems that few investment properties will go empty. Indeed, 41 per cent of the landlords surveyed reported that tenant demand was growing strongly, with 51 per cent saying that it remained stable.
These results correlate with a falling level of home ownership, which has reached its lowest point for over 25 years. With property prices continuing to rise, there can be little doubt that home ownership will fail to rebound quickly, if at all, during the coming year.
Now is a good time to buy a Buy-to-Let property. If you would like more information, please contact us on [email protected] or 0131 6560390