Interestingly, around 85% of those questioned revealed they had not previously used short-term funding, but most would now consider using it to help grow their property portfolios more quickly.
Despite constant discussion in the media of potential interest rate rises and the likely impact on the buy-to-let market, landlords remain ambitious and enthusiastic about capital growth despite industry concern that the housing market is slowing.
Bilal Ahmed, CEO of Signature Private Finance, believes that renewed confidence and optimism in the buy-to-let market will trigger sustained and significant investment in the sector by UK landlords in 2015. “Landlords are not expecting dramatic or unaffordable rises so, as our research reveals, the expectation is the sector will continue to grow in 2015.
Their willingness to further invest and increase their portfolios highlights a confidence among those already reaping the benefits of buy-to-let.
This is great news for the long term prosperity of the sector. Millions of people now depend on the flexibility of rental accommodation, a choice which offers quality, yet affordable homes to help them save for a deposit should they wish to buy in the future.”
Of those landlords surveyed at the show by Signature, 78% said they had previously bought properties in urgent need of refurbishment. The size of portfolios varied with the majority, 58%, owning one to three properties, 24% of landlords owning four to ten properties and eight per cent with a portfolio between 11 and 25.
Ahmed continued: “Despite the potential for costs to rise, it seems lower house prices, more tenants in the market, rising rents and the increasing availability of competitive mortgage deals have once again tempted property investors.
The Midlands offers particularly good opportunities for landlords, with both the West and East Midlands in the top five regions for buy-to-let returns, due in part no doubt to the range of amenities and facilities. Locations with good road and rail links are always high on the list of desirables, making these type of places so attractive for buy-to-let investors.”
Landlord and Lettings Show key findings:
76% of landlords plan to increase their property portfolio in 2015
89% purchase buy-to-let properties
15% purchase properties using short-term finance/bridging loans
32% purchase using cash
46% have bought property at auction
85% of landlords would now consider short term finance/bridging loans to extend their portfolio
78% have bought property in need of refurbishment
58% of landlords own 1 to 3 properties, 24 per cent 4 to 10, 8 per cent 11 to 25
