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Despite tax and regulatory changes ‘there is still money to be made in the PRS’

With savers receiving poor returns from banks and building societies, thousands of people unsurprisingly continue to turn to residential property as a means of supplementing their income, supported by record-low mortgage borrowing rates, growing demand from renters and stable yields, as buy-to-let consolidates itself as the investment of choice for many investors. 

Despite a challenging time for the market, characterised by tax and regulatory changes, investment in buy-to-let continues to outperform most major asset classes, as demand for properties in the private rental sector continues to grow.

David Alexander, joint managing director of apropos by DJ Alexander Ltd, said: “There is still money to be made in the private rented sector and being a landlord can provide a reasonable income and a healthy pension. But landlords need to be more savvy to make it work and much more pro-active than in the past.” 


“You must ensure your finances are arranged as efficiently as possible, that your costs are reduced to the minimum, and that your margins are as good as they can be.” 

Rents in the UK’s private rented sector are rising, with the latest data from HomeLet revealing that they reached £953 per calendar month (pcm) in October, up 2.7% year-on-year. 

All 12 of the regions monitored by HomeLet showed an increase in rental values between October 2018 and the corresponding month this year.


Meanwhile, according to the latest mortgage lending figures, the number of new BTL loans achieved its second highest figure for the year in October 2019 at 6,600 while the value of these loans equalled the highest for the year.

BTL remortgaging was at the second highest level for the year in October 2019 at 6,600 and matched the highest monthly value of the year. 

The number of BTL mortgages in arrears has dropped by 5% in the third quarter compared to the same quarter in 2018 and the total number accounts for just 0.23% of all BTL mortgages outstanding.

Alexander continued: “Being a landlord has never been more difficult but like all businesses the best people will understand the need for flexibility and be ready to change to meet the circumstances. It is inevitable that there will be change and you must make your business model to match the market. 

“There may be some casualties along the way but BTL remains a profitable and viable investment for those who adapt and thrive in a changing market.”

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Poll: Do you remain committed to investing in the buy-to-let market?


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    • 25 December 2019 05:14 AM

    Got nothing at all to do with being savvy.
    LL are under attack by a stupid Govt.
    The Irish Govt did the same thing and it took them about 3 years to realise the policy mistakes they had made.
    But all this was at the cost of great Irish homelessness and rents increasing by over 50%.
    Well now the UK Govt is trying the same stupid ideas but much worse.
    S24 being the most ridiculous of them which the Irish Govt only enforced for new BTL properties.

    Only the most stupidest Govt would have introduced S24 for BTL properties purchased 15 years previously.
    But that was Osborne for you............................a very stupid man!
    LL can be as savvy as they like but stupid Govt policies undermine any savviness.
    Along with the still pathetic dysfunctional eviction process as it is now being a LL is a very risky business where there are mortgages to pay.
    The least risky way to be a LL is to be unencumbered.
    50% of the PRS needs a mortgage to provide rental accommodation.

    That is the very risky part of the PRS.
    Then you have the poorly thought out UC process which has resulted in LL refusing to take HBTenants on and get rid of existing ones.
    I'm afraid the PRS will continue to come under attack by an increasingly stupid Tory Govt though less stupid than a Labour one would have been and consequently savvy LL will continue to leave the PRS or rather letting on AST.
    Tenants are suffering because of these stupid Govt policies.
    Govt shows no signs of understanding anything about the PRS.
    This is evidenced by their intention to abolish S21 failing to understand that it was a major reason for lenders to lend and LL to invest.
    Govt simply fails to understand or even comprehend the business imperatives of being a LL.
    It consequently makes ridiculous policies which ultimately cause massive detriment to tenants as LL continue to divest.

    This looks like continuing the same if not worse for the PRS.
    Savvy mortgaged LL will be getting out out of AST lettings market.
    They don't have much choice the way this Govt is behaving.


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