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Residential buy-to-Let

Why is now a good time for investing money in buy-to-let property?

Author: Gemma

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The latest figures from the Bank of England show that mortgage lenders have reduced rates for buy-to-let investors. There are currently 100 more buy-to-let options available now than there were 3 months ago.

With more options available to investors, there couldn’t be a better time for investing money in the buy-to-let market.

And it seems that investors are following this sentiment.

Figures from Connells Survey and Valuation show a 37% rise in activity in the UK’s buy-to-let market in January.

According to lettings agent Ludlow Thompson, the number of buy-to-let property investors has increased by 8% in the last year, with 1.63 million individuals now owning a buy-to-let asset. Ludlow Thompson’s research shows that these properties are producing around a £13.1 billion annual NET
income.

Rising rental returns

Good news for those investing money into the buy-to-let market, the latest figures from the HomeLet rental index have shown that rental rates for residential tenancies in the UK increased by 2.5% in January 2015.

The report shows that the average UK rent for tenancies in January 2015 reached £889 per calendar month, this is 11.2% higher than January 2014 (£799pcm).

Highlighting the high demand for rental property across the country, most regions saw an increase in average rental values, with London witnessing the steepest climb.

Average rents for new tenancies in London are now 12.3% higher when compared to the same time last year. Renters can expect to pay £155 more per month in London in January 2015, than the same period in 2014.

When London is excluded, the average UK rental value reached £702pcm – up 3.7% when compared to last year.

With rental rates on the up, investors can expect to see a rise in their rental returns.

Rising property values

Property prices in the UK witnessed double-digit increases in 2014. With the general election just a few months away and a continued uncertainty surrounding rising interest rates, many experts expect property prices to temporarily slowdown in the first half of the year.

Investors may benefit by purchasing a property now while the price of property is rising at a slower rate.

Property experts forecast that UK house prices will increase by 5% by the end of the year.

With rising rental costs, rising property prices and a wider range of financial funding available, now may prove to be a good time to for investing money in the UK’s buy-to-let market.

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