UK buy-to-let rental renaissance.
It is now widely recognised that the private rented sector has a crucial role to play in both the UK housing market and the economy. More people are renting than ever before and with increasing numbers of people living alone, housing supply is at an all-time low. 2013 saw the lowest level of house building since the 1920’s, and there is now an extreme housing shortage accross the country.
The average age to purchase a house in the UK has risen to 37 over the last 10 years, leaving millions of people renting for longer periods. These tenants are people from all walks of life and all professions, who are unable to purchase a property due to the tighter regulations in the UK mortgage market. All of this has caused a thriving buy-to-let market in the UK.
On the flipside, whilst the younger generations struggle in the rented sector, thinking they’ll never be able to buy, their elders are more concerned with their pensions, or the cost of care in the country. As a result more individuals are looking to the buy-to-let market to create a sustainable income for their future.
According to a report by HSBC, properties that do not need to be refurbished attract a higher rental returns, stating perfect properties attract an average return of 5.4% in rent, whereas those needing an upgrade will muster 4.4%.
"Ready-to-move-into properties are often the savvier choice for landlords looking to purchase additional BTL properties," said HSBC's head of mortgages Peter Dockar.
"Not only does this avoid the need for lengthy and expensive renovations, it can also result in higher yields in most areas of the country.
"While the initial purchase price will be significantly higher, rental returns are also improved, making monthly mortgage and maintenance costs more palatable."
To cater for increasing demand in the UK buy-to-let sector, Select Portfolio have introduced UK buy-to-let apartments to their client base. The high-end developments offer purpose-built apartments for sale with low purchase prices and excellent yields.