How is the shortage of new properties affecting the buy to let market?

From all the media stories, no-one is quite sure whether the property market is booming or not!

How is the shortage of new properties affecting the buy to let market?

A shortage of new properties is affecting the UK rental market

The simple answer is that the buy-to-let sector is doing very well but it would be doing even better if there were more new properties to buy. There’s an increasing market in the number of people looking to rent which means that demand is pushing up rents.

Indeed, the Council of Mortgage Lenders recently said that investing in houses and flats to rent is growing in popularity once more.

They say that the number of buy-to-let properties soared by 84,000 last year – with buy-to-let mortgages now accounting for nearly 13 per cent of the total outstanding value of home loans in the UK.

That means that investing in property to rent is a worthwhile proposition once again.

But let’s not kid ourselves about the current situation for prospective investors. While the buy-to-let market is picking up, it’s nowhere near the heady heights of the 2007 property boom. And most of the investors picking up properties for their letting portfolios are cash-rich investors.

It makes sense really: property prices are relatively low and rent prices are still fairly high which means that there’s a good return on your investment.

And the market for renting a home in the UK is continuing to grow.

Estate agents Countrywide say that last year, more than 275,000 new tenants registered for private rental accommodation – a 24 per cent increase on the previous year.

Across most of the UK there is a shortage of property to rent which means rental prices are remaining high and increasing in some areas.

Potential landlords can still buy property to enjoy the rental market using buy-to-let mortgages from many lenders. In fact, there’s so much competition for a potential landlord’s business that the average borrowing rate on a buy-to-let mortgage has fallen in recent months.

The headline of this article is: How is the shortage of new properties affecting the buy to let market? However, it would be wiser to read this as: How is the shortage of new good quality properties affecting the buy to let market?

That’s because the population of the UK is growing and it’s a relatively transient one – people are moving to where the work is and they are willing to pay for a good quality home.

Though there is no doubt that underpinning the buy-to-let market is the fact that not enough new homes are being built and people are living longer as well as the fact that there are more single person occupied homes.

For more information and advice on the current state of the buy-to-let market, contact the UK’s premium provider of landlord services NoLettingGo.co.uk or call 0800 8815 366.

No Letting Go are the UK’s leading provider of inventory management services, providing check in and check out services, property inventory and condition reports and specialist on site services to landlords, lettings agents and property professionals.

Buying is cheaper than renting in most U.S. cities

I am always interested in great property stories around the world and read an interesting article on CNN World about how it is now cheaper to buy than rent in most US cities ( http://money.cnn.com/2011/08/16/real_estate/buy_rent/ ) – if only that were the case in the UK.

Nick

Large deposits make inventories more important than ever

This article up from Property Drum by Operations Manager for ARLA, Ian Potter, further highlights how critical inventories with schedule of condition report have become.

With such large sums of money at stake, ARLA has called on tenants and landlords to consider the benefits of establishing a comprehensive property inventory check upon the commencement of a new let.

Ian Potter, Operations Manager of ARLA, said, “Deposit disputes can be one of the biggest problems for both parties involved in any rental property, and many potential issues can be avoided if a professional inventory is prepared.

“A licensed letting agent will offer you the best advice on checking to see if an existing inventory is available or whether any extra charges are invoked in drawing up a new document. A true inventory is not simply a list of items in a property – it also includes a description of the condition and cleanliness at the start and finish of the tenancy, enabling one to be compared against the other with clarity and accuracy.

“Photographs are a good support for comments made in a written inventory but should not be considered a replacement for the written word. Photographs which are unsigned and undated generally are not worth the effort, so make sure they are accepted at the outset and again at the check-out stage.”

Ian Potter said, “A well put-together inventory can give both landlords and tenants peace of mind throughout the occupation period. The inventory is not designed to catch tenants out, but rather to ensure both parties are in agreement over the quality of the property being rented.

“If conducted correctly, and agreed by both tenant and landlord, an inventory should form a key point of reference for any deposit-return queries or issues over reported damage. In recognition of the importance of inventories ARLA has its own sub division, the Association of Professional Inventory Providers, whose members have passed an accreditation exam as well as having a Code of Practice to follow.”

For Professional Inventory Management Services throughout the UK talk to No Letting Go, APIP members, who can provide all inventory management services including Inventory, Check In, Propert Visits and Check Outs with full dilapidations reports. Contact us on 0800 8815 366 or contact one of our local offices at www.nolettinggo.co.uk/contact