9th
Oct 2013
Despite the Help to Buy scheme rolling out across the country a nationwide estate and lettings agent reports that new tenants are entering into the sector which has lead to a rise of 25% over the three months leading up to September. As more people are being given assistance to become homeowners they report that the private rented sector is flourishing.
Tenants and rents are both increasing as average quarterly rents across England, Scotland and Wales was up by 2.7% in this year’s third quarter. The Company is also reporting that returns on rented properties were healthy at 6.1% and of course one and two bed-roomed properties are the highest with an average of 6.6% yield.
A leading property investment sourcing company says that buy-to-let registrations have soared by 85% year on year and demonstrates the attraction that the sector has for new investors with average new registrations topping 2,500 per month.
CEO of the investment property sourcing company Stuart Law said: “It is important that buy to let investors look to the North now while prices are low, before the rise in property prices ripples out from London and the South East,”
“Property investment has become main stream again in the last year and, with interest rates so low, people cannot see a downside to buy-to-let. However we are now at a critical point where property prices will start to rise faster than rents; this will happen first in Greater London which has seen tremendous price increases in recent months.
“Investors who are keen to not miss out on property price growth and stunning yields currently achievable in the rest of the country ought to invest there now.”
The Estate and lettings agents also state that across all regions rental arrears fell in the third quarter of 2013. Scotland however had rental arrears rising by 4.2% but overall the time is great for buy-to-let investment.
The spokesperson for the firm feels that the Help to Buy’s launch, which aims to help people onto the property ladder will not have a major impact on renting sector.
“The recent announcement to introduce Help-to-Buy Phase 2 in October 2013 will undoubtedly facilitate a proportion of tenants to make the transition to home ownership. This is great news for both first time buyers and tenants frustrated by the lack of available accommodation in the current market.
“Older tenants and families are now forming an ever larger proportion of tenants renting in the UK,” Dunning continues. “There are varying reasons why people rent for longer but many choose to do so because they enjoy the flexibility it offers, especially in terms of job mobility. With this in mind, now is an ideal time for landlords to expand their portfolios and provide a more diverse range of affordable rental properties to meet the demand of those renting for longer.”
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