With the outlook for savers looking dismal, many people continue to invest in the tried and tested route of bricks and mortar which generally offers high returns, especially as far as the buy-to-let market is concerned, as many investors benefit from both rental yields and sometimes increasing property prices.
Although returns have fallen in recent years, investment in buy-to-let continues to outperform major asset classes, despite the various economic and political headwinds that the sector has faced of late.
According to the latest HomeLet Rental Index, the average cost of a new tenancy in the private rental market in the UK rose by 1.5% to £918 per month in April, helping to boost rental income for buy-to-let landlords, which increased by 8% in the last tax year from £15bn in 2014-15 to £16.2bn in 2015-16, according to ludlowthompsow estate agents.
The London-based agency says the figures, based on HMRC data, show that buy-to-let properties remain among the highest yielding mainstream investments in this country.
Stephen Ludlow, chairman at ludlowthompson, said: “Buy-to-let-properties continue to prove themselves one of the most popular and dependable investments around.”
“There are very few, if any, other investments that offer investors a regular monthly income on top of capital growth.”
“Although the market has cooled in recent months, there are still huge growth opportunities in the buy-to-let sector in the long-term, with the pool of potential tenants getting larger each year. The fundamental supply/demand imbalance remains.”
He added: “London in particular continues to see increasing demand for rental properties, and as long as that continues buy-to-let investors are in an extremely strong position.
“Growth in wages like we are seeing today has also historically led strong growth in rental values, so the opportunity for investors in buy-to-let properties is still there.”
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for me first and foremost it's the income, capital growth is a bonus, with house prices now dropping the capital growth will not be there for a few yrs, but you only make a capital loss if you sell, so don't sell.
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