Posts with tag: Buy-to-Let

Record-low interest rates to drive property demand

Published On: May 26, 2017 at 11:50 am

Tags: Buy-to-Let,interest rates,landlords,mortgage rates,tax

Record-low borrowing levels should increase demand for property across Britain during the coming months, according to a number of various property experts.

This comes despite a recent fall in the number of mortgage approvals for property purchases. Gross mortgage lending fell by £18.4bn in April, down 11% from March, according to the most recent data from the Council of Mortgage Lenders (CML).

Encouragement

Despite this fall in lending figures, a number of housing market analysts predict that low mortgage rates will lead more people to borrow money in order to invest in property.

Jeff Knight, marketing director at Foundation Home Loans, said: ‘Although we’ve seen a slight dip in mortgage lending levels, the housing market seems to be enjoying a return in buyer confidence.’

‘First-time buyers and remortgaging activity continued to drive lending volumes throughout April, as low interest rates have, and will continue to, support demand.’[1]

Record-low interest rates to drive property demand

John Eastgate at OneSavings Bank said that he wasn’t surprised to see a fall in lending levels following the recent rise in inflation. However, he also expects to see conditions in the market improve.

‘This [the fall in mortgage activity in April] is likely to be only temporary and I don’t see any long term trend being established by these figures,” he said. “Inflationary pressures will pass and low rates will continue, and the mortgage market will remain robust,’ he noted. [1]

[1] https://www.propertyinvestortoday.co.uk/breaking-news/2017/5/low-interest-rates-will-continue-to-support-demand-for-property

Who tops the Premier League table for rental yields?

Published On: May 26, 2017 at 10:12 am

Author: Em Morley

Categories: Landlord News

Tags: Buy-to-Let,Football,investors,Premier League

With the F.A Cup and Play Off finals set to bring the curtain down on another domestic football season, an interesting new-look Premier League table has been released.

The table, collated by North-East based sales and lettings firm KIS and deposit-free renting solution Dlighted, positions the 20 Premier League clubs on the strength of their local property market.

More specifically, the standings show positions if team were judged on average returns for buy-to-let let investors for two-bedroom properties in their local postcode area.

Mersey Pride

Merseyside took the title, with Everton pipping neighbours Liverpool to the crown by just 0.3%. Properties in L4 offer average returns to investors of 9%, in comparison to 8.7% in Anfield’s postcode region of L6.

The Champions League spots were taken by this years relegated sides Middlesbrough, Hull and Sunderland, where returns are 8.5% 7.1% and 7% respectively.

On the other hand, Premier League Champions Chelsea would be relegated in this table, alongside runners-up Tottenham and new Europa-League members Arsenal. Typical returns in these regions amount to 2.2%, 1.2% and 2.7%.

Manchester United survived the drop by the skin of their teeth, finishing 17^th with yields of 3.8%.

Who tops the Premier League table for rental yields?

North-East

Ajay Jagota, founder of Dlighted and KIS, observed: ‘It’s been a tough year for fans of the Premier League teams in our native North East and we’re glad that there’s at least one table where Sunderland and Middlesbrough are close to the top.’

“Even though this is all just a bit of fun and not a serious investment guide, we have inadvertently learned something very interesting about the state of the buy-to-let market in England and Wales.’

‘There is a theory in the industry that landlords are increasingly turning away from London and the South East and investing instead in other parts of the country. With no London club finishing higher than 14th and North East and North West clubs dominating the league, our table suggests that this could actually be a very wise move.’[1]

[1] http://www.propertyreporter.co.uk/property/everton-top-the-premier-league-of-renting.html

New funding for would-be landlords

Published On: May 26, 2017 at 8:58 am

Author: Em Morley

Categories: Landlord News

Tags: Buy-to-Let,investment,landlords,property investors

A new £20m funding initiative has been launched with the intention of supporting a generation of first and second-time property investors

The initiative from Market Financial Solutions (MFS) is targeted at refurbishment and restoration projects in the £1.4m empty properties across Britain.

Funding

On-going until June 2018, the £20m funding drive will be made available to nationwide applications through bridging loans in the range from £100,000 to £1m.

With Britain gearing up for another General Election on June 8^th and against the looming backdrop of Brexit, MFS’s property investment drive offers landlords fast access to monies required to support their short-term investment plans.

Over the next year, it is anticipated that traditional asset classes such as property will remain strongly in demand. A recent survey of property owners indicates that 88% expect house prices to increase during the next six months.

This said, many potential investors and homeowners face difficulties in gaining finance from traditional lending institutions. In turn, this is inhibiting many peoples’ investment strategies.

The most recent Bank of England data shows that 66,837 mortgages were approved for property purchases during March – a fall of 1.6% from the previous month. Loans approved for re-mortgaging also fell for the first time this year, to 42,814.

New funding for would-be landlords

Strength

CEO of MFS, Paresh Raja, said: ‘In the face of seismic political events this year, the robust strength of the UK property market has certainly proved its resilience. For the sector to continue this impressive growth, support must be channelled to the aspirational investors who will lead this growth forward, a vital objective we are directly addressing through this initiative. There is tremendous value locked in a variety of properties across the nation; without the finance options in place to access them, this part of the property market will remain dormant. To support the refurbishment and restoration projects that are essential to catalyse further movement across the sector, MFS has launched FlipFinance2017 and is very excited to see the results build into fruition.’[1]

[1] http://www.propertyreporter.co.uk/landlords/20m-funding-drive-launched-to-help-budding-landlords.html

Buy-to-let investment is still a reliable asset class

Published On: May 25, 2017 at 1:47 pm

Author: Em Morley

Categories: Landlord News

Tags: Buy-to-Let,buy-to-let landlords,investment,rental market

Buy-to-let landlords have certainly had a rough time of it lately. A raft of legislation changes, such as alterations to mortgage interest tax relief, Stamp Duty surcharges and the Right to Rent scheme have all provided difficulties for investors.

The fact is that these tax changes mean that buy-to-let does not offer as lucrative returns as it once did. However, many people still believe that this asset class offers a solid, stable investment.

A soaring demand for rental property is underlined by the fact that the average age of a first-time buyer in the UK is now 35 – as opposed to 24 one decade ago.

Rewarding

Offering his assessment, Stephen Reade, letting operations manager at Harrison Murray Lettings, part of the Nottingham, said: ‘Becoming a landlord can be a rewarding experience and, if done correctly, provide a steady and sustainable return as an income investment, especially compared to lower savings rates and stock market swings.’[1]

‘Investors are snapping up property in the hope that it will not only return a reliable yield but also a benefit from capital growth given enough time. Mortgage rates at record lows are helping buy-to-let investors make deals stack up,’ he continued.[1]

Buy-to-let investment is still a reliable asset class

Moving on, Reade urged landlords to make sure their figures add up before investing.

‘One day they [rates] must rise and you need to know your investment can stand that stress test, a criteria sought by many lenders recently. Recent history provides an important lesson in how returns can be hit. Many buy-to-let investors who bought in the boom years before 2007 struggled as mortgage rates rose. A sizeable number were thrown a lifeline when the base rate was slashed to 0.5 per cent. Rates stuck there until this summer and then were cut again after Brexit, but they will rise again.’[1]

‘Even considering the recent tax changes and potential for buy-to-let mortgage costs to rise, there are many positives. We are becoming a nation who sees renting as a flexible lifestyle choice and is far more sociably acceptable. With greater demand from tenants, rents that should rise with inflation and the long horizon for interest rate rises, mean many investors are still tempted by buy-to-let,’ Mr Reade concluded.[1]

[1] https://www.landlordtoday.co.uk/breaking-news/2017/5/buy-to-let-remains-a-steady-and-sustainable-income-investment

ZPG announces hike in listings and agents

Published On: May 24, 2017 at 11:54 am

Author: Em Morley

Categories: Property News

Tags: agents,Buy-to-Let,landlords,property market,ZPG

ZPG has today published its half-year figures, which reveal a 6% increase in the number of agents and 9% rise in the total listings on its Zoopla and Primelocation portals.

This has resulted in a 22% hike in revenue for the group. 750 estate agent breaches have been to the portals in the last two years, with ZPG moving to invest in a new business that will provide an alternative to tenants’ deposits.

Rising Revenue

During the six months to the end of March 2017, revenue increased to £117.9m, with ZPG recording record traffic. Over 314m visits to the company’s websites and apps were seen in the period – 68% of these using mobile devices.

This 6% rise in agents took the total to 14,271 branches, with inventory now up over 928,000 listings.

What’s more, average revenue per partner has increased by 5%, driven by a healthy demand for portal and software products.

ZPG announces hike in listings and agents

Records

Alex Chesterman, founder and chief executive of ZPG, noted: ‘Our audience grew by five per cent with a record 314 million visits to our websites and apps and we achieved record levels of brand awareness for both Zoopla and uSwitch.’[1]

‘We also made good progress on our continued product differentiation with the launch of an innovative new Move Planner tool which provides a one-stop shop for all moving related services and are pleased to announce today a strategic investment in Zero Deposit, a new business seeking to transform the lettings market by providing an alternative to tenant deposits,’ he continued.[1]

‘We remain incredibly excited by the underlying growth across each of the business divisions, our recent acquisitions and the significant cross-sell opportunities to our highly engaged consumer audience and our unrivalled partner base,’ he concluded.[1]

[1] https://www.estateagenttoday.co.uk/breaking-news/2017/5/zoopla-reports-big-surge-in-agents-and-listings-in-past-six-months

Buy-to-let investors set to look North

Published On: May 24, 2017 at 8:59 am

Author: Em Morley

Categories: Landlord News

Tags: brokers,buy to let market,Buy-to-Let,north of England

Fresh research from the Legal & General Mortgage Club has revealed that a number of brokers believe that the North of England will become a hotspot for landlords over the course of the next year.

Those brokers attending the Legal & General Mortgage Club’s recent buy-to-let forum event were quizzed on the development of the buy-to-let market. This followed the series of legislation changes that came into force in the last twelve months.

Streamlining

As a consequence of the legislation changes, 69% of brokers feel that landlords will look to streamline their portfolios. Many will look to sell properties with lower yields, while 45% feel that buy-to-let investors will turn their attention to university towns and student accommodation.

Jeremy Duncombe, Director at the Legal & General Mortgage Club, observed: ‘Over the past 12 months, the buy-to-let market has experienced a myriad of legislative changes. Today’s research from Legal & General Mortgage Club’s inaugural buy-to-let forum shows one of the impacts of these developments, with developers looking North for value. Landlords are resourceful and this demonstrates the resilience of the market, despite many changes.’[1]

Buy-to-let investors set to look North

‘The last year has been a particularly challenging year for buy-to-let. The Stamp Duty hike, coupled with the changes to tax and the PRA legislation affecting landlords with four or more properties, has undoubtedly impacted the purchase market in particular. However, it is reassuring to see that confidence in this essential tenure remains as landlords respond and adapt to this new landscape,’ he added.[1]

This report marries up with a separate one from Barclays released yesterday, which again highlights northern locations as the most popular for investors moving forwards.

[1] http://www.propertyreporter.co.uk/landlords/the-north-predicted-to-become-a-btl-hotspot.html