13th
Nov 2015
A property firm has estimated, from its research, that since 2009 landlords have given the HMRC £180 billion in capital gains tax contributions.
The private rented sector continues to thrive with house prices increasing; giving the market higher rents and mortgages can be relatively cheap considering the gains that can be achieved from buy-to-let.
In 2000 buy-to-let was just 4% of mortgages and in the second quarter of this year (2015) it has boomed to 16%.
Over the next couple of years the Industry believes that average rents will by rise by 2.5% per year and the major cities could expect a 3% yearly rise.
Peter Armistead of the company said: “It’s not surprising that the sector is booming with the impressive yields, capital asset growth and growing demand for rental accommodation. Manchester has seen yields rise by an average of 4-5 per cent over the last 12 months and demand is outstripping supply. It takes an average just 14 days to find a tenant and void periods are almost non-existent.”
He said that the increase is down to the relocation of the BBC and the ever expanding student population. There are very little housing developments underway and there are tough planning laws to contend with when attempting to renovate older properties, causing demand to be higher than market supply.
Armistead added: “An average residential property in Manchester is just £155,000, while a flat in a good area, costs as little as £120,000. A property in Manchester can provide a 5 per cent minimum cash rental yield and a typical 12 per cent total cash yield, including 7 per cent capital appreciation. Demand for rental accommodation is strong and by comparison with other regions, housing is cheaper.”
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