This week, senior mortgage and protection advisor at Oportfolio Mortgages Jade Pinkerton attended the latest Coutts Bank and Savills Market Update webinar. One hot topic of discussion was the UK buy-to-let market, and whether it was still ‘worth it’. In this blog, I am going to give an overview of the sentiments on buy-to-let investment shared in the webinar.
Buy-To-Let Investment, Pressure On Rental Supply, And Increasing Rents
Rent continues to surge, with an average increase of 10% in August 2023 and another 5% in August 2024. This is largely due to the ongoing shortage of rental properties and a heightened demand, which is driving rents up. On the flip side, new regulations and rising capital gains tax have put a squeeze on the profits landlords can expect, potentially leading to higher rents in an already supply-constrained market.
Tighter Regulations, But Still A Liquid Market
One major shift in the buy-to-let sector is the introduction of the Renters’ Reform Bill. While tenants will enjoy more security, landlords retain the right to sell their properties, although the sale process may take longer. These changes make some investors nervous, but the liquidity in the market remains, and with rents continuing to rise, landlords can still charge market rates.
A Changing Landscape For Landlords
The days of short-term tenancy agreements are fading, and we see fewer people buying BTL properties unless they are in the very wealthy bracket. Coupled with the construction industry’s struggles—labour shortages, rising material costs, and lengthy conveyancing times—it’s not as easy to turn a quick profit in BTL as it once was.
Despite these challenges, if you’re a landlord who can navigate the new regulations and understand the long-term view, BTL investments may still be worthwhile, especially given the rising rental yields.
Speak To A Buy-To-Let Mortgage Advisor
If you are thinking of buying a buy-to-let property either this year or next, or are already a landlord looking to refinance your rental property, the best place to start is by speaking to a mortgage advisor. Our team of experts at Oportfolio mortgages are here to help you every step of the way in the buying process. Give us a call or send us a message today.
