Six out of 10 landlords are looking to expand their property portfolios by the end of the year and London continues to be an attractive market.
The majority (84%) of investors looking to increase their portfolio hope to buy more houses and flats, according to research from specialist mortgage broker Mortgages for Business.
Landlords’ plans to purchase residential properties should go some way to satisfying high demand for rental homes, which currently outstrips supply.
Just 3% of investors are looking to reduce their portfolios over the next six months, compared with 6% who were looking to downsize when asked the same question last quarter.
The buy-to-let property market is becoming increasingly popular as yields become more attractive.
London Money director Mark Hollands said: “It is no surprise to me that property investors are looking to expand their portfolios over the coming months.
“With strong rental yields due to the fact that many first time purchasers cannot afford to buy a house coupled with poor savings rates, many investors have been turning to property for far greater returns than they would see from their bank.”
More than three-quarters of landlords want lenders to go further to support them, with many expressing concerns over rates and fees.
But Hollands believes the environment could soon improve for landlords.
He said: “With the recent and quite dramatic fall in swap rates in addition to the governments ‘funding for lending’ scheme whereby some £80bn in of cheap loans has been set aside to pass on to customers in the form of mortgages we should now see some attractive opportunities start to surface.”
Investment London’s Paul Hicks says landlords looking to expand in the capital should put the effort in to ensure they can access the right finance.
Hicks said: “In London, finding the right finance quickly is important. It’s now more important than ever that you have your finances in place before you even start to consider looking.
“But mortgages are available and you need to ensure you get the best rate possible.”
Landlords hoping to add new properties to their portfolio should also consider which area of London they are looking to buy in, Hicks said.
“Location is very important when buying, so get to know the area you are buying in well. You may wish to see help from specialists.
“If you get this right not only will get a good rental yield and a good supply of quality tenants but you will also get good capital growth. Different areas have different properties that are worth investment for different reasons.
“Your chances of finding the right property, with the best return on investment, dramatically increase if you have access to property not yet put on the market.”
Contact Paul Hicks: [email protected] or call 07734 111654. Please note this is by invitation only and not a public offering.
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