The Property Ombudsman

Buy To Let investors in the UK increase by 8%

An increase in the number of UK buy to let investors has reached a staggering 1.63 million, an 8% rise from the previous year.

According to new research, capital growth for the average residential property reached over 7% in 2014, which experts believe may have attracted more first time investors to the market.

Data released from Council of Mortgage Lenders also showed an 18% annual increase in the number of buy to let mortgages.

The report follows the news that mortgage interest rates have fallen to an all-time low, with some lenders offering as little as 0.5%, meaning buyers can get a much better deal on their property purchase than ever before.

The buy to let boom is predicted to continue into 2015 thanks to the recent stamp duty changes introduced in December which has seen the majority of property investors benefit from the cuts and boost their income. The pension reform that takes place in April also looks set to create a new wave of interest in buy to let property investments.

Figures released from the Office of National Statistics also coincided with recent reports. The overall annual rise in house prices was up almost 10% from the previous year, with the average price in the UK now standing at £272,000.

The UK overall has seen a steady and sustainable growth. When London and the South East were removed from the data, the UK saw an overall increase of 7.4% year-on-year. London alone reported an upsurge of 13.3% - almost double when compared with the rest of the UK, indicating that the property market in London is seeing prices rise at an unsustainable rate. This will inevitably make it more difficult for buyers looking to purchase within the London area.

Comments from Sequre

Graham Davidson, Managing Director of Sequre Property Investment, comments on December’s House Price Index from the Office of National Statistics:

“As has been the case in previous months, the ONS house price index continues to show just very small month on month fluctuations. The annual increase in 2014 in London alone, in our opinion, is not sustainable and prices simply cannot continue to grow at this rate throughout 2015. The annual increase for the UK in 2014 when London is excluded indicates that a steady and much more sustainable growth has been achieved outside of London in 2014. We are delighted that the investors who took our advice to purchase buy to let property outside of London in 2014 have not only received a great yield return from their investment but have also seen their equity grow steadily which we are confident will continue in 2015.” 

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