Data released by ludlowthompson has revealed a huge increase in rental income over the last 12 months. With a 15% year on year increase, a massive increase from £16.2bn in 2015-16, to £18.7bn.
The HMRC data analysed by ludlowthompson suggested rents are seeing growth, driven by strong demand outstripping the current supply of housing. With figures revealing that the total rental income has increased by 55% over the last 5 years.
This data, combined with the growing availability of attractive buy-to-let mortgage deals. Suggests that investing in property to let continues to be a strong investment option, despite some recent increases in tax exposure and legislation.
Stephen Ludlow, chairman at ludlowthompson, went on to say :
“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.
“The fundamental supply-demand imbalance remains with the pool of potential tenants getting larger each year. This is still the case in London, despite Brexit jitters.
“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.”
A tangible investment that still offers returns
The market is flooded with options for investment, but bricks and mortar still offer something a that stocks, shares and ISA’s can’t offer. Direct control of an asset and options to exit. Whether an investors wants to hold a property for rental yield, remortgage to raise funds or sell for a capital appreciation gain. These are tangible benefits, that other asset classes simple don’t offer.
Despite some negative media sentiment and changing market conditions. The UK property market continues to see healthy signs of growth, especially in regional cities beyond London.
Cities such as Manchester, Birmingham, Leeds, Liverpool, Preston and other outer commuter towns. Continue to offer great potential, while having the the huge benefit of price points much lower than equivalent properties in the South. Leading to stronger rental yields and less money spent on stamp duty.
Source – ludlowthompson
