Support, Advice and Experience within the Property Market

Why should we still invest in property?

From Robert Ulph on November 26, 2015

I have written before about the pros and cons of buying an investment property to let and with recent negative reporting about whether it has had its day – is property still the best place to invest?

It can feel like there is constant flack for the sector; with the removal of tax breaks, possible mortgage constraints, talk about the ‘Right to Rent’, landlord licensing by councils and so on. As a result the image of private landlords seems to swing wildly between being seen as saviours of the housing crisis to being greedy individuals who care about nothing else but huge profits.

With so much going on in the sector it can be no surprise that some landlords are selling up – how much more pain must they take?

Well if I can give you something to feel more confident about the market and to give anyone thinking of investing in property a reason to do so, because I do believe the market has a promising future. And why? It’s all down to demographics.

Looking at the Office for National Statistics forecast the UK population is to increase beyond 70 million in the next 12 years and around two thirds of this growth is down directly and indirectly to inward migration; Directly because of those coming to the UK from other countries and then indirectly because of the children they may have. The other third of the growth is down to an expanding birthrate and, more significantly, an ageing population.

The statistics go on to predict by 2039 that nearly 30 per cent of people in the UK will be aged over 60 – up from 23.2 per cent this year. Perhaps even more food for thought comes from the fact that one in 12 people by 2039 will be aged over 80.

So why does these figures have any bearing for those involved in buy to let or property investment?

First, the experience of recent years suggests that a migrant population tends to rent, at least to begin with, and locally we are already seeing an increase in the requirement for rented accommodation and we would expect this boom to continue for at least another 10 years.

Secondly, recent research carried out by Savills suggests that the renting population is becoming increasingly diverse and the ‘typical tenant’ is changing. Different types of accommodation are needed for the various demographic groups – young single people in their twenties looking to flat-share will be looking for very different accommodation to a family or an elderly couple, for example.

Due to this swelling population of the UK which is and will continue to easily outpace the supply of purpose-built homes, there is plenty room for Build To Let without damaging the Buy To Let market, as I am sure they can operate side-by-side.

With these figures and a very healthy, steady increase in house prices and rents locally, it would seem that the private rental sector offers a valuable housing service that should not stop anyone from looking to invest now and in the foreseeable future.

My advice is to keep buying to let out as the county needs the investment to sustain the demand. So if you are thinking of investing, have a property to let or need any further advice please do not hesitate to call me on the details below.