With buy-to-let returns continuing to beat all other mainstream investments, including commercial property, UK government bonds and cash, while remaining a highly popular alternative to the volatility investors often risk when investing in the stock market, a growing number of investors are choosing to invest in the UK housing market, according to Surrenden Invest.
The property consultancy report that despite the introduction of higher stamp duty purchasing costs, the recent scrapping of the wear and tear allowance, the pending removal of landlords’ mortgage interest tax relief from next year, and the fact that the average rental yield in the UK has eased slightly, more novice investors are being drawn to the buy-to-let market mainly because the returns routinely outperform those of other investments.
Jonathan Stephens, managing director of property consultancy Surrenden Invest, says that his firm has seen an influx of inexperienced investors who have never considered property for investment before, choose to abandon institutional investment products for more favourable returns available in the buy-to-let market.
He commented: “We have seen a huge influx of relatively inexperienced investors who in most cases have never considered property for investment before.
“These clients are what we call 'one time' investors who, in contrast to our large portfolio clients, are unlikely to be in a position to invest the same levels of capital again. These investors are looking for a one-time opportunity to get into property to secure their financial future.”