The Buy-To-Let sector has seen many changes over the past 12 months, with updated legislation directly impacting on the benefits and legal ramifications of being a Landlord. However, property still continues to be a popular and considerably beneficial investment, we’ve taken a look at some of the key reasons why.
Low interest rates
Unprecedented low interest rates have essentially reduced the benefits of saving. There are smaller returns on offer, meaning an investment will likely offer higher rewards, which paired with a volatile stock market, make property a thoroughly appealing investment opportunity.
Low mortgage rates
Fixed Buy-To-Let mortgage rates have seen record lows this year, offering a great borrowing rate. It could be financially beneficial to consider longer term fixed rates, to make hay whilst the sun shines on these low rate offerings. A fixed rate package also provides consistency and certainty for that period, allowing a thorough understanding of the financial gains available with a Buy-To-Let property. The affordability and appeal of low mortgage rates have sent Buy-To-Let mortgages to a 10 year high.
Strong tenant demand
Whilst interest and mortgage rates have declined, the number of tenants has increased. According to the Centre for Economics and Business Research “The UK is experiencing a supply-side crisis in the rental sector. We need more professional, affordable tenures and more choice for renters.” Rental demand for all types of properties is already at an all-time high and experts predict that up to a quarter of all households in the UK will be renting by 2025. Whilst tenant demand for rental properties is currently high, it is set to get higher!
Higher rental incomes
The average rent on a new tenancy outside London was £776, up 2.3% compared to the same period in 2016, this is the rise seen in August alone. The Royal Institution of Chartered Surveyors has also predicted that rents will increase by just over 25% in the coming years, whilst over the last 35 years, for which accurate house price index information is available, house prices have increased 11% per year on average. The longer landlords can hold onto property, the better, both in rental returns and in property worth.
If you’re considering a Buy-To-Let investment, come along to our bespoke event on 28th September (4pm-8pm) where we will have independent financial advisors available to offer expert advice, along with our Lettings Director who can offer a wealth of knowledge on the subject. We’ll also be offering incentives on Pembroke Manor, a new build in Hook where we can include Stamp Duty contributions and legal fees. To register, or for more information, please call (01256) 764666 or e-mail firstname.lastname@example.org.