Buying to let on the rise
08 March 2004
The practise of buying to let is experiencing considerable growth, according to a new survey.
In the latest survey, commissioned by mortgage specialists Mortgage Trust, the landlords questioned expect to increase their portfolios by an average of 18 per cent over the next twelve months, a rise that equates to at least one extra property each.
This year has thus far been a good one for the buy to let brigade, with Paragon Mortgages' January 2004 buy to let index showing landlords earning total returns of over 20 per cent in 2003, realising a return of £22,137 on an average property bought 12 months ago at £110,120.
And the Mortgage Trust survey provides further evidence of the buoyant letters' market, with 78 per cent of landlords stating their average vacancy period in a year as less than four weeks.
Studies indicate that this low vacancy rate will remain largely unchanged over the next 25 years.
According to a recent Times survey, Britain is currently at the forefront of Europe's house price inflation, with an average house priced at £160,000. Indeed, house prices increased 16 per cent in January alone.
And, with the mortgage base rate having risen to 4 per cent in early February, the outright purchase of decent accommodation is becoming infeasible for many people.
Austin Jelfs of Mortgage Trust, said: “The buy to let market is still strong and growing and it looks set to stay that way for at least the next 12 months with investor confidence as buoyant as ever.
“This has been reflected by the number of new products being launched across the sector, offering investors a wider range of choice and rates.”