subject: Be Wary Of The Buy To Let Market Boom, As Hasty Decisions Could Spell A Disaster For Your Investment [print this page] Last year, there was an increase of 20% in the amount of investors investing in buy-to-let properties according to research from The Landlord Syndicate.
The Landlord Syndicate is an association representing landlords throughout the UK and have remarked on the recent resurgence in buy-to-let properties and investments, insisting prospective landlords should be vigilant to personal financial standing, cost of potential investments, the location and the capacity to commit to a long-term financial investment as well as location which are all key to take full advantage and to allow the current market to work to your advantage. A decrease in the average house price as well as high rental prices create the perfect economic climate to invest in property and for investors to enjoy high profits and returns in a buy to let purchase.
The organisation has urged prospective landlords to commit to long-term yields and investment plans, to research all financial packages and mortgage lender offers for financially viable options and to plan accordingly for potential market changes. Long term earning potentials are readily available if investments are thought through sensibly and arranged accordingly.
Simon Thompson, Chairman of The Landlord Syndicate said: "Before the recession, rising house prices fuelled investors, who were really speculators, to buy 'discounted' flats. The resulting house price crash left many of them holding property that would never pay for itself by rents because too many similar properties were grouped in a development, pushing down yields and prices."
A spokesperson for the Landlord Syndicate stated: "Today 25 per cent of the new-buy properties we reference are houses compared to two years ago. These are mainly traditional three bedroom semi-detached or terraced properties and houses in multiple occupation, subsequently the number of tenants we reference with children has also increased by 30 per cent in the last 12 months." As well as adding that the regulations covering buy to let mortgages are to be increasingly monitored during the coming decade.
Professional bodies are working to protect landlords during the property market boom. New landlords may not be fully covered, or may not have a complete comprehension of new laws, guidelines and regulations which may have a detrimental impact on their investments in the future. Investors with the most expansive portfolios are also urged to maintain their knowledge and awareness surrounding letting and selling homes. Over the last 20 years landlords have had to be more in the know in regards to their sector than ever before, and to not let high yields, special offers and increasing profits come above maintaining a legitimate business. HMO properties without the relevant licences can face heavy fines and a slip up regarding tax can be financially lethal to an investor.
So despite the excitement of a buy to let boom, those who keep in the know are in the best position to keep financial returns and profits. Remain educated and well informed on landlord issues and stay ahead of tenancy rights and renting rules to retain your reputation as a prominent landlord. Failure to do so could be the failure of what may now see like a lucrative investment. The revenue available in the short term should not out-weigh a long term investment opportunity.
