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Now Is The Time To Get Into Property Rentals

Nov 17, 2007
Right now is an exceptionally good time to become a buy-to-let investor, according to two separate reports.

Two different firms have announced that market conditions are ideal for people who want to invest their money into property rentals.

And that's going to be good news for the thousands of people across the UK who have already invested in property, in the hope of giving their pension fund a boost, or of making a faster return on their money than other kinds of investment.

This trend has been partly fuelled by TV property shows, which often show people making a profit from development and property rentals despite little knowledge in the market. The message that many people have received is that virtually anyone can make cash by buying a house, doing it up and selling it or renting it out.

Certainly investment specialists Assetz agrees that it is currently a buoyant market. It recently said that market conditions are ideal for people who want to make a purchase and gain an income from property rentals.

The firm argues that conditions are spot on for medium-term investors, despite fears the housing market is facing a slowdown in growth or could even see falling prices.

The Royal Institution of Chartered Surveyors reports that a record number of first-time buyers are currently choosing to rent rather than buy, while they wait to see what happens with the housing market.

And this has apparently put huge pressure on the prices of property rentals. Prices are being forced upwards - there is even talk of record growth rates.

The Association of Residential Letting Agents agrees. It recently declared that demand for rented homes has seriously outstripped supply.

And with the likelihood of interest rates dropping soon, Assetz believes buy to let has a bright future.

A separate investment consultancy agrees that there is huge confidence for investors in the UK property rentals market right now.

Property For Life did a survey into confidence, and said 64 per cent of investors thought the interest base rate had already peaked.

As a result of that, 76% of investors in its October survey thought it was a good time to buy a house and rent it out. That's an increased confidence since the firm's last survey in September, when just 72% of people thought that way.

The survey revealed some other fascinating facts about current beliefs in the property rentals market.

52 per cent of people who have a buy to let investment said they are feeling the pinch of interest rates.

Last week the Bank of England held rates, leaving them at 5.75%. Rates have been on hold at that rate for four months in a row, after five rises since August last year. The bank was keen to cool what it saw as an overheating economy.

This happened against a background of the Home Information Packs, or HIPs being introduced for the sale of three and four bedroomed houses. This may have contributed to a slowdown in the growth of house prices.

In the survey, 54 per cent of investors thought the base rate would fall in the coming months. It's possible that that extra confidence could see even more money invested into the property market, creating more flats and houses to rent.

The results of the Property For Life survey also showed that few investors expected property prices to rise in the next year. Only 38% of people in the survey thought they would see prices go up. That result is down from 48% in the previous month.

In the long-term, investors seem confident that they will see a return on their investment.
About the Author
For more information about property rental, have a look at the Property Today website at: http://www.propertytoday.co.uk/Renting.aspx
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