As we are all aware the supply of properties available to rent cannot keep up with the demand from prospective tenants and as one of the largest local agents, at Pennington, we are certainly seeing this. This all means that rents are healthy but what does it mean for those thinking about investing in property?
With the turmoil of the past two years, those who may have considered investing in or continuing with holiday lets may be less confident now, compared to a long-term rental as the stability and guarantee of income is a significant factor for many.
The question of buy-to-let investments is, perhaps unsurprisingly, one I get asked most about. So, if you are considering a BTL and you have the finance to do so, is now a good time to invest and what should you be buying?
Some interesting research I saw recently was looking at the type of property popular with landlords and interest in semi-detached houses has grown, overtaking terraced as the preferred property type for landlords to buy. The research was carried out by Paragon Bank with 800 landlords and reports that 14% of these landlords are looking to buy new property this year, with 40% looking for semi-detached homes to let and 39% looking for terraced options.
This perhaps is a result of tenants looking for larger property, with an increased demand for space to work from home as remote or hybrid working remains with us. It also includes those with families looking to relocate and may want to rent somewhere before they buy.
In this same vein, popularity with landlords of detached houses to let has also grown, with 18% of landlords in the research considering a detached investment compared to just 9% previously.
As with any investment you make, I would always advise to do your research. A successful investment will depend on what you want to achieve and the longer-term plan you have. Tax changes over the past few years have meant that new investors might be looking at alternative strategies and while I can’t give advice on your personal tax liabilities, I can work with you to make sure that you get the best value from your investment.
I have seen too many times BTL properties bought almost on a whim. Investors may have bought in a certain area because they liked it, but I always look to advise how to get the best return on their investment in terms of where to buy, what to expect to pay for the property and what return to expect in rental income.
The best advice I can give is to get assistance from a professionally qualified agent. At Pennington we have in-house licensed members so there is always someone on hand to assist.
I have assisted hundreds of first-time landlords and seasoned investors purchase the right BTL property, so please do not hesitate to contact me for any advice.