The buy to let Landlady
The Buy-to-let market is expecting a fight back with investors snapping up properties to rent out. But it's not as easy to make a quick buck as it used to be. That's the view of brokers and estate agents, despite new reports showing we're seeing a general resurgence in the property market.
One particluar forecast showed that 58 per cent of buy-to-let mortgage brokers expected rental incomes to increase in the coming years, and 70 per cent reckon property values will also rise.
The views follow figures from the Council of Mortgage Lenders that show buy-to-let lenders advanced a record number of buy to let mortgages i.e.year on year increases of upto 40 per cent.
Residential property remains a popular investment and this is set to continue.
Additional findings from the Royal Institution of Chartered Surveyors reveal the biggest increase in tenant demand in more than four years, with 27 per cent more surveyors reporting a rise in new lets, rather than a fall.
Since the start of 2006, women have bought over 24 per cent of all buy-to-let property sold which is a significant increase on last year, when women represented 20 per cent of the market.
The north west, along with the south east has consistently had the highest number of landladies since 2004. In fact, female property Investors account for 29 per cent of the market in Greater Manchester.
It is great to see that the number of landladies is steadily increasing as more women realise the investment opportunities offered by residential property.
All of this might spell good news for established investors with rental properties already in their portfolios. But where does it leave those yet to get onto the buy-to-let property ladder?
Soaring property prices in the last 10 years, coupled with poorer stock market returns means we've become used to thinking of residential property as a sound investment. However, it's not necessarily as easy as many people think.
Our figures revealed that 33 per cent of potential investors are put off buy-to-let, as they don't feel they could find a suitable property and were not confident of their own knowledge of the market.
Researching the market is critical, there are still opportunities but buyers need to be careful, go into it with their eyes open and buy only at the right price.
When you are deciding where to invest your money you need to consider the options, for example, if you have £15,000 to invest and you put it into shares on the stock market, over 10 years, realistically, your investment may have risen by 50 per cent. Therefore, you have made £7,500.
However, if you use £15,000 as a deposit for a home worth £100,000, getting a mortgage for 85 per cent of the property price and the value of the home increases by 50 per cent over the same period, you have made £50,000.
However, you need to factor in the associated costs and the management of property and that rental returns may not give you the same income as stocks and shares, because of paying the mortgage and carrying out any repairs.
However, getting a good buy to let mortgage deal is easier than ever. With lenders fighting for a market share of the buy-to-let business, prices are being pushed down some fixed rates are now as low as 3.95 per cent and the criteria is more lenient.
In some cases you can now get 90 per cent loan to value on rental properties, this makes property a good long term investment for more people.
More incentives are being offered to buy-to-let mortgage borrowers looking to switch borrowing from one provider to another. When looking for the best deal, it's important not to be swayed by the freebies.
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