The Rise Of The Buy To Let Market
3 minute read
The popularity and size of the buy to let market has increased rapidly over recent years, with investors seeing it as a prime opportunity to capitalize on lower house prices. 2014 in particular has seen a significant rise in how much lenders have been prepared to support people looking for buy to let mortgages, with lending reaching a huge £2.4 billion. The increased demand for the types of houses that make prime rental properties has been one of the catalysts for recent price rises now that we are recovering from the recession and investors are increasingly coming up against first time buyers in this area.
Some say that because of this new wave of buy to let properties being sold, it gives first time buyers no chance to get on the property ladder. However, others say that it is a more convenient way for people to find homes without having to go through the process of being approved for a mortgage. There has never been more help available for first time buyers than there is right now. With schemes like Help to Buy, mortgages are now offered at cheaper rates or with discounts, and it is much easier to secure them. However, the reported battle is set to continue between property investors and first time buyers throughout 2015 and beyond as the housing market begins to gather pace.
Why is buy to let a great investment?
There are a lot of things to consider when you decide to buy a property that you want to let. You must consider the price of the property and how much rent you’ll charge. It’s also a good idea to cover all eventualities. For example, if the property remains vacant for a few months between tenants and what agencies will charge you if you choose to use their services to market and manage your rental. Just like any other business, the buy to let sector requires business plans; it’s important to make a profit or your effort is for nothing. The good news is that there are lots of buy to let mortgage deals out there and if you take your time, shop around, and speak to a broker, you could find a great one.
If you are a first time landlord, you may want to test the waters by purchasing just one property to let out to see how you feel about maintaining it. If you find that it is something you want to continue with, re-mortgaging your first property could free up the cash to put a deposit on your second.
Timing is key to finding an investment property that’s a great deal. Keep your eyes open and weigh your options when it comes to price, type of property, and area. There are many people that make a great income from property rentals, so it’s certainly something that can be done. Gather as much information as you can and develop a plan of what you want to achieve through buying a property to let. It isn’t something that will be easy but if you take your time and do your best to make smart decisions from day one, there’s no reason that it shouldn’t be an ideal investment.