Property guru Phil Spencer has set out five reasons to keep faith with buy to let.
In an article for Estate Agent Today the Location, Location, Location star urges agents to promote buy to let - both in terms of properties to sell to landlords, and property management thereafter - and lists a string of what he regards as compelling reasons.
Firstly, capital returns are good albeit not guaranteed. New figures from he Halifax show that at average UK house prices grew by 20.4 per cent between January 2020 and December 2022, up by £48,620 from £237,895 to £286,515. “We doubt that same level of growth will be seen in the next three years but long term capital appreciation has been consistently good for bricks and mortar” he notes.
Secondly, rental returns have been strong especially in high yield areas. Lettings agency Hamptons estimates that an average property bought in 2017 would have generated £96,000 in rental income over the past six years.
Thirdly, there seems little prospect of rental demand slowing significantly, as housebuilding levels are low, especially for affordable housing. Fourthly, would-be investors still have the option of owning buy to lets through a company to minimise their tax and overheads.
And finally landlords can genuinely feel they are contributing by providing a home “and it’s not the landlord-tenant battleground some people claim it to be.”
In the article Spencer chronicles the various tax and regulation changes of recent years which have led many to question the financial viability of buy to let.
He also disputes those campaigners and activists who have tried to paint buy to let landlords negatively.
He says in his column: “We know that almost all of those perceptions are unfair, and that the private sector provides valuable and typically good quality housing to tenants wanting the flexibility of renting. And we know that buying the right property in the right place, with a target tenant in mind, can still be financially rewarding despite a growing tax burden and more regulations.”
You can read his full column here.
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We can give them a lot more reasons than 5 to exit but not allowed and held to ransom.
Just as well the Landlord Event was held yesterday or there would be hardly anyone there today tube strike, mind you most of them didn’t arrive until late morning in order to use their freedom passes so tight.
What I have been saying from the outset was inadvertently confirmed yesterday by speaker Mr Paul Shamplina when he said 200’000 landlords had left the market but supply wasn’t down because it had been filled by the Corporate Company landlords, this is exactly what government wants to happen which is why they are targeting us at every turn, concessions for them, penalties for us.
Good morning.
200,000 properties may have been brought into the market by the corporates. But they have bought nothing in my neck of the woods, N Wales to replace the PRS landlords who are leaving in droves and leaving not much to rent there. I presume they are only interested in cities and apartments, not family homes.
Yes I think you are correct there, big cities and shoe boxes in the sky is what the big boys want
Guru ? LOL
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