With Tax changes post Brexit, many buy-to-let landlords are in doubt as to whether they invest with the recent resurgence. However, Brexit could make for a silver lining for buy-to-let landlords, as the majority still see property as an attractive investment at a time of volatile stock markets and interest rates.
Property is bouncing back, encouraging investors and bringing new investors to the market. As an income investment for those with enough money to raise a big deposit, buy-to-let looks attractive. Encouraging landlords to snap up property in hope of it’s rising value along with low savings rates and stock market swings, for its proponents, there's almost a perfect storm.
So is buy-to-let still worth it as an investment? If so, is it worth prioritising over other forms of investment, such as funds and shares or your pension?
With the positive effects on buy-to-let at a high with mortgage rates at an all time low, helping buy-to-let investors make deals stack up, so it is always worth being cautious. As we may see a rise in these low rates and a possible tax rise, challenging your investment. As buy-to-let mortgage interest relief is axed and replaced with a 20 per cent tax credit. Additionally, from April 2016 landlords now have to pay an extra 3% stamp duty on property purchases.
However, despite the tax changes and fear of mortgage rates rising, the greater demand from tenants in the UK property market should mean many investors are still tempted by buy-to-let. David Hollingworth, of mortgage broker London and Country, says that “if prices were to plateau or come down that could help them add to their portfolio.” Challis agrees: “Rental demand is expected to stay strong [as more people struggle] to obtain mortgages, and may even see an uplift if uncertainty is prolonged. This will create new opportunities for investors.”
With the positive effects currently on buy-to-let properties, If you’re considering investing, or want to find out some more information here are some pointers you should consider to make a good buy-to-let investment.
* Your target tenant: What are you tenants needs? Who are they and what will they expect from a property? For example, a student will be wanting accessible transport, and a close walk to the university in a bustling area. Pick a tenant to target and consider their needs for a property and always remember, location, location location.
* Supply and demand: Are there properties in your particular area that are in high demand? Is there a need for flats or houses, check out the market and do your research into what’s in demand at that time or even what will be in demand going forward, as there is always a need for property but a greater need for properties with particular features and amenities.
* Is the property mortgageable? Lenders can be choosy about property, so be aware if you’re borrowing to buy. They can be particularly cautious of council flats and new developments, as they can be over priced at times. Be prepared for lenders to be wary!
If you have made your decision, why not give our team a call on 0191 209 2222 OR visit our website at https://www.mansons.net today!