There has been a lot of negativity surrounding the buy-to-let market in recent times, but this doesn’t ring accurate with many people’s actions. Yes, there have been new tax issues and regulatory changes for landlords to deal with, but there has been a significant level of demand. Buying a property to let is more expensive for landlords, particularly with the change in stamp duty, but many would-be buyers struggle to step on to the property ladder.
Therefore, there is an opportunity for landlords to make a positive return on their investment. A study examining the past decades’ worth of investments indicates that buy-to-let investments outperform most major asset classes. The VeriSmart research suggested that the increase in value for property over the ten years is a 92% return. Most investors would be happy with this style of return over a decade, and it is something for landlords and property investors to bear in mind during these challenging times.
The study suggests buy-to-let is a more suitable investment opportunity than gold, art or cash while it is only edged out by investing in the FTSE 100 or buying classic cars. However, there are notable peaks and crashes in the stock market, and many people would prefer to avoid a volatile investment opportunity.
While investing in classic cars sounds appealing to many people, there would be a temptation to use your investment for fun, as opposed to waiting for the long-term benefit. Investing in buy-to-let property may not seem as exciting as some options, but it is a sensible way to utilise your money.
Bricks and mortar will always provide an opportunity for investors
Jonathan Senior of VeriSmart, has spoken out on the importance of bricks and mortar as an investment, saying; “[The] statement was a missed opportunity for the Government to backtrack on their previous attacks on the buy-to-let sector, attacks that have done little to solve the UK housing crisis and if anything, have caused further restrictions in the level of suitable stock while keeping rental prices buoyant as a result. However, the buy-to-let sector remains the backbone of the UK property market, helping to support aspirational homeowners as they work to overcome the sometimes impossible financial barriers of homeownership. The need for this support is clearly evident as it remains one of the most lucrative investments one can make.”
Many believe more needs to be done to improve the property and lettings markets
The Government has a lot to consider these days, but it is clear they aren’t doing enough to address problems in the property market. This situation creates the demand for rental property, and this, in turn, creates the opportunity for landlords to utilise their time and money effectively.
Owning property provides a chance to see an asset increase over the long-term, but letting the property also offers a benefit over the short-term.
If you’re a landlord looking for support in the buy-to-let market, or you would like guidance on how to enter the market, get in touch with Andrew Lees. We are pleased to say we have supported many Bridgwater landlords, as well as landlords operating across Sedgemoor & Taunton Deane, and we look forward to helping you.