18^th Mar 2019

HMRC figures have been analysed by a lettings agent and they have found that PRS Landlords' rents have shot up by 15% in one year; this is in spite of the many new tax regulations and legislations that have been imposed upon the private rented sector.

From the latest available HMRC data for the UK, the London based agents state that landlords rents during 2016- 2017 rose to £18.7 billion in 2016-17, from 2015-2016's £16.2 billion; this shows that BTL investment still remains one of the highest yielding forms of investment.

Over the last five years total rental income has rocketed by 55% and by contrast, because of low interest rates, cash ISAs and savings have generated very title growth.

“Buy to let property is now a key part of individuals’ investment portfolios and retirement income. Residential property not only offers investors a stable, regular monthly income, but also offers long-term capital growth. While house prices are not a one-way bet, property has historically been far less volatile than other asset classes, such as shares” according to Stephen Ludlow, the agency’s chairman.

“Some of the increase in rental income will also be from rental growth, which means that rents are largely growing with inflation. Additionally, wage inflation has been growing steadily already over the past few months, and, historically, rental increases track wage increases.

“Ultimately, these figures highlight the real term growth in returns – the fundamental point behind any sound investment.”

The agency's analysis of the HMRC's figures shows the landlords' total rental income increases since 2011:

2011-12: £12.1 billion;
2012-13: £13.1 billion;
2013-14: £14.2 billion;
2014-15: £15.0 billion;
2015-16: £16.2 billion;
2016-17: £18.7 billion.

But one major point to consider is that the major tax and legislation changes came into force at the end of the end of the 2016-2017 tax year.


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