Despite concerns that landlords are being put off buy-to-let, new research shows older and portfolio landlords in particular aren’t going anywhere.
Almost a fifth (18%) of all landlords have declared their intentions to remain active in the buy-to-let sector indefinitely, according to a recent survey conducted by Foundation Home Loans, putting paid to the idea that residential landlords are leaving the market in their droves.
With mortgage tax relief changes and stricter lending criteria adding to the hurdles faced by some landlords, it seems many still see themselves operating successfully in the long-term, with particularly high optimism levels in the east of England where almost a quarter (24%) of buy-to-let investors don’t have any plans to sell up.
Bigger landlords in it for the long run
Older landlords are the least likely to be giving up on the sector, with 20% of over-55s saying they planned to continue operating indefinitely, while a similar proportion (19%) of portfolio landlords – who own four or more properties – also plan to stick around. According to the research, larger landlords operate in the sector for an average of 15 years, while those with less properties are expected to stay invested for 10 years.
Only 6% of those surveyed said they were thinking about giving up on buy-to-let in the next one or two years.
Jeff Knight, marketing director at Foundation Home Loans, said: “There have been ripples of concern that a mass exodus of landlords is expected, and certainly the changes introduced are a handful to deal with if not addressed in the right way. But this is clearly an exaggerated view of the market.”
Avoid a ‘knee-jerk’ exit
Knight added: “With so much interest in investing in the long-term, it is therefore imperative that newer landlords are sufficiently supported to avoid any knee-jerk exits. This is particularly the case for portfolio landlords as diversification is key to maintaining cashflow.
“Seeking the help of a financial adviser will help landlords navigate these hurdles, professionalise their approach and ultimately ensure they can remain in the market.”
With recent research showing that property investors who stay invested through the peaks and troughs of the market still tend to make good returns, those who are able to take the latest “doom and gloom” headlines with a pinch of salt may find themselves better off in the long run.