Huge opportunity for buy-to-let investment amid calls for stamp duty cut

 

Institutional investors are seeing the opportunities available in buy-to-let investment. The government should enable landlords to help boost the property market. 

Long before coronavirus came to the UK, the country’s housing market had been shifting. For many years, homeownership levels had been dwindling in favour of renting. Furthermore, the consensus seemed to be that the rental market was only going to increase.

This was down to a variety of reasons, many of which will still apply after the worst of coronavirus is behind us. One is affordability, as many people prioritise renting with friends over living at home to save up for a deposit. House prices to earnings ratios have also increased significantly over the past few decades. This means saving up to get on the property ladder often takes longer.

Lifestyle changes as well as the job market are also major factors. More people now move away from home to go to university, for example, and then stay on to work in their university town. For this demographic, renting is often the obvious choice. For graduates and non-graduates alike, it also brings added flexibility should you need to relocate for work. There’s also less responsibility for things like repairs and maintenance.

The future of renting and opportunities for investment

The Bank of England’s “worst-case scenario” prediction is that the UK could face a serious recession. However, right now, the global situation continues to change on a weekly and even daily basis. It is therefore impossible to predict where we will be six months or a year from now. The hope is that, as the housing market has begun to rally, other sectors will follow suit.

According to Mary-Anne Bowring, managing director at Ringley Group, people are more likely to continue to rent during uncertain times. Committing to homeownership will not be the top of a lot of people’s agendas. While this may not be positive news for the government’s drive to get people onto the housing ladder, Bowring believes people should instead support and facilitate the rental market and buy-to-let investment even more.

Bowring said: “There is a huge opportunity still for buy-to-let investors in the UK rental market, which is only predicted to grow in size.

“That’s why institutional investors such as pension funds and insurers are investing billions in building homes for rent, as they see an opportunity to secure income-producing investments that hold up well during a downturn.”

Cut stamp duty for property investors

Like many others in the sector, Bowring believes the government should make some changes to stamp duty. The Royal Institute for Chartered Surveyors (Rics) recently called for a stamp duty holiday across the market.

At present, landlords, property investors and anyone buying a second home must pay a 3% stamp duty surcharge. Bowring believes that this should be scrapped to bring these buyers to the market.

Bowring said: “Government efforts to restart the housing market should reflect long term pre-existing trends and that includes the continued growth in private renting.

“If the government wants to kill two birds with one stone – boost activity in the housing market and provide much needed rental homes – it should exempt landlords from the second home stamp duty surcharge immediately.”

Whether the government will take heed of the messages coming from the industry remains to be seen. While the property market is slowly getting back on track, an extra boost could be a bonus. Meanwhile, the underlying message from Bowring is for property investors to press ahead now to make the most of the growing buy-to-let rental demand.

BuyAssociation has a wide range of property investment opportunities available across the UK. Sign up for free now for more information, or get in touch directly. 

Highgrove Mews

High Net Yield Freehold Houses

  • Commutable to London (27 mins to central Paddington station)
  • Rental demand extremely strong with large industry presence in Reading
  • Freehold with 4% net yield

£284,955 - £457,000

St Petersgate – Stockport Manchester

New Launch - Stockport Manchester, apartments from £160,000

  • Discounted launch prices from £160,000
  • Excellent transport links with 3 trains per hour to London Euston and only 9 mins journey to Manchester Piccadilly
  • Experienced development team

Assured Rent Housing Association Leases

Assured Rent Housing Association Leases

  • Assured rent & no rental voids
  • Tenant damage cover & newly refurbished inline with requirements of a corporate sitting tenant
  • Free property and lettings management

From £62,000

Emerging Birmingham Commuter Town With Properties From Just £104,000

The emerging Birmingham commuter town where properties are selling in an average of just 24 days

  • A collection of 62 two bedroom apartments and 28 one bedroom apartments.
  • DE14 is one of the fastest selling postcodes in the West Midlands.
  • 23 minute train journey into Birmingham New Street Station.

Properties from £104,000

Mill, Stockport

The Northwest's emerging property hotspot

  • Discounted off-plan 2-bed prices from £162,000
  • Completion date - Q4 2021
  • Rental yields - 6% plus

Discounted off-plan 2-bed prices from £162,000

South Central – Birmingham City Centre Apartments

Highly anticipated 28 storey launch in Birmingham City Centre with an impressive roof garden and communal facilities.

  • 154 units across 28 storeys
  • Residential multi-media community room, gym, roof garden and sky cinema
  • Excellent future connectivity via the metro system to other key transport hubs and locations around the city

from £205,800

ba-

Talk to us

Speak to our UK property experts today: 

+44 (0) 333 123 0320

Open from 9am-6pm GMT

+852 9865 4446

Open from 9am-6pm HKT

Stamp Duty Calculator

.

Unlock members only investment opportunities and full development details. Join now – it’s free, quick and easy.

Login

Not a member? Sign up for free

landlord property investment

Huge opportunity for buy-to-let investment amid calls for stamp duty cut

Example

By submitting your details via this online form you agree to be contacted via email/phone/SMS by Direct Marketplace Ltd t/a BuyAssociation in relation to property investment and property developments . We do not share your personal details with third parties.  To view our full Privacy Policy click here.