Buy-to-let properties in the UK are currently in high demand and there appears to be plenty of room for further growth, as more investors look to invest in the private rented sector, new research shows.
Four out of ten mortgage brokers expect to write more buy-to-let business in the next 12 months, according to the Paragon Bank’s latest Financial Adviser Confidence Tracker Index.
The survey of more than 200 intermediaries revealed that 41% of advisors currently expect more buy-to-let business, up from 38% from the final quarter of last year.
Richard Rowntree, managing director of mortgages at Paragon Bank, commented: “Despite the buffeting that coronavirus has caused to the mortgage market, and housing sector more broadly, there is clearly still strong and stable demand for buy-to-let via intermediaries, which is reflected in the results of this survey.
“We have seen a solid rebound in buy-to-let business since the housing market reopened in mid-May and landlords have been unlocking capital to invest and grow their portfolios further.
“We expect to see increased demand for rented property underpinning growth in the coming months as people delay house purchase or cannot obtain a mortgage with the removal of higher loan to value products in the residential market.”
Rowntree continued: “Coronavirus has had a clear and damaging impact on the economy and the UK as a whole, but the long-term fundamentals underpinning demand for buy-to-let remain unchanged.
“The UK has a growing population with increasing numbers of households and the private rented sector will provide a good quality home for many of them.”
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It strikes me that now would be a good time to de-risk and reduce BTL holdings, rather than add to them. Financed investments come with extra risk so in such uncertain times one wonders why some landlords want the headache. Rents look likely to fall, unemployment is set to sky rocket and gaining possession in default looks problematic. If it goes wrong one might say you only have your self to blame.
Can't wait to offload my rental properties to some dozy newbie LL!!
None of them will have a clue about what is going on in the PRS.
But bring it on I say.
It could give me the chance to exit if high demand is expected.
Belatedly these dozy newbie LL will realise the poisoned chalice they have bought into.
Too late though.
They will have sunk costs which they will need to at least recover.
So they will be stuck being LL for quite a few years.
So many lambs to the slaughter I suppose!
Many will be entering the PRS as a consequence of all those ridiculous GRQ seminars.
More fool them.
Now is NOT the time to become an AST LL.
Rather as suggested getting out etc is what savvy LL should be doing.
Diversifying into other forms of residential letting other than AST letting would perhaps make more sense.
Govt hasn't finished with it's efforts to eradicate the AST LL.
So if you aren't one you shouldn't be eradicated.
Though if I was a cynic I suggest Govt will next attempt to eradicate FHL LL.
Paul , how come you are not being slated here for being some sort of renegade? I see the pitfalls plus the uncertainty.
Thats the problem when governments have not invested in their own properties inc private house purchases and to a LL a property is an investment but to a renter its their home, do you ever wonder what will happen to those you turf out, I doubt it, thats why I think its a toxic business
It is a good time to sell if you want. Rents however are not going to fall UK wide. They are still going up
All well and good until the next pandemic and again resultant Govt sanctioned mass rent defaulting and eviction ban.
No thankyou.
Just about survived being bankrupted.
Not going to risk it again!!
No amount of additional rent will cover a future bankruptcy!
Actually Paul I agree increased rents doesn't protect us from us from the rent shirkers & the legislation coming down the path. Local councils are seeing the private LL as an easy score with licencing & the increased ability to impose massive fines to shore up their inability to keep to budgets
Yep totally agree Jahan and as I'm a coward LL I simply DON'T have the bottle to remain an AST LL.
@markwilson
DON'T know in answer to your query.
I follow your sentiments as I believe you are correct.
Indeed I will be attempting to do as you suggest.
I am very very pessimistic as to the PRS future.
If things were as they are now 12 years ago no way would I have become an AST LL.
It is now a very fragile business model.
Personally I'd rather see my capital returned to a 0% savings account.
No chance of some robbing rent defaulting tenant using my capital for a free lifestyle.
I DON'T mind dead capital at least tenants can't get at it.
I'll just spend it.
Got a fair bit so that plus pension will do me.
Life is too short to carry on with the increasingly troublesome PRS.
The rot set in about 2015 when dopey Osborne introduced S24.
I wanted to exit then but couldn't for various reasons.
For me S24 was game over.
Been trying to get out ever since!
And as you exit you potentially make people homeless, thats nice, us renters share your dislike of Landlords as a group its safe to say the dislike is at least mutual
Sorry - did I miss something? I didn't see Paul say he was going to demolish any properties thus adding to homelessness. He will sell to someone who hasn't been feckless enough not to save the necessary deposit to get on the property ladder. Perhaps your lack of understanding of this is why you're still a tenant and contributing to your landlord's wealth?
Most landlords and tenants get along just fine, I think Mr Edmunds you sound like a tenant that most of us on here would not want at any money, I've made a note of your name don't bother applying to rent from me I would rather have the property sit empty than have the likes of you in it.
Paul - You are correct.
The crooks are using the virus to avoid their contractual obligations.
And that is plain wrong.
These people MUST be relentlessly chased to the ground to pay back what they owe.
No other business in the world allows itself to be treated like this.
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