{"id":6034238,"date":"2021-02-18T10:57:01","date_gmt":"2021-02-18T10:57:01","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=6034238"},"modified":"2021-02-18T10:57:01","modified_gmt":"2021-02-18T10:57:01","slug":"more-first-time-landlords-are-entering-the-buy-to-let-sector","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-hk\/2021\/02\/18\/more-first-time-landlords-are-entering-the-buy-to-let-sector\/","title":{"rendered":"More first-time landlords are entering the buy-to-let sector"},"content":{"rendered":"

The stamp duty holiday and low interest rates have enticed more small and first-time landlords to enter the buy-to-let sector.<\/strong><\/p>\n

Fewer investors are relying on only cash to purchase properties. Data from major London estate agency Hamptons<\/a> reveals 52% of landlords bought property with cash during 2020. This is the lowest figure on record. In 2017, the share to buy-to-let properties purchased with cash peaked at 62%. In each subsequent year since, the proportion has fallen.<\/p>\n

Aneisha Beveridge, head of research at Hamptons, comments: “While investor purchases remain low compared with pre-2016 levels, the stamp duty holiday has tempted more small and first-time landlords<\/a> back into buy-to-let, reversing a shift towards portfolio investors.<\/p><\/blockquote>\n

“Most of these new entrants are relying on a mortgage to fund their purchase, despite the changes to mortgage interest tax relief<\/a> eating into the profitability of the sector for some.”<\/p>\n

Attractive market conditions<\/h4>\n

The stamp duty holiday<\/a>, which was announced in July 2020, has accelerated the number of first-time landlords entering the market. During the last half of the year, the proportion of landlords purchasing properties with cash fell to only 50%. This is a record low with first-time landlords taking advantage of the tax holiday savings.<\/p>\n

First-time landlords typically use mortgage finance<\/a> to fund their property investments. Because of this, cheap borrowing costs<\/a> have made it an even more attractive time to enter the market. Additionally, during times of uncertainty and instability, and when savings rates<\/a> are especially low, UK property can be a safe haven as a form of investment.<\/p>\n

With these attractive market conditions, the number of buy-to-let landlords has reached 2.7m, which is an all-time high<\/a>. And nearly half of buy-to-let landlords are optimistic<\/a> about 2021 despite challenges and uncertainty ahead.<\/p>\n

Aneisha Beveridge says: “Since 2016 the rental sector has been buffeted by tax and regulatory changes, resulting in 250,000 fewer rental homes in England since the sector\u2019s peak in 2017.<\/p>\n

“But record-low interest rates on cash in the bank combined with the lure of a stamp duty holiday has enticed a new generation of investor, many of whom had no previous landlord experience.”<\/p><\/blockquote>\n

What first-time landlords need to know<\/h4>\n

In the past few years, there has been a raft of recent legislative and tax changes to the buy-to-let sector. Additionally, as the sector has become more \u2018professionalised\u2019 in the past few years, there\u2019s been a record number of buy-to-let landlords setting up limited companies<\/a>. Seek professional advice to see if this is right for you.<\/p>\n

It\u2019s also important for first-time landlords to know the latest rules, regulations and best practice in the private rented sector. There is a wealth of knowledge online for new buy-to-let landlords<\/a>.<\/p>\n

NAEA Propertymark, the National Residential Landlords Association, and the British Landlords Association provide a range of helpful information. Check out HMRC and the government’s websites for additional resources for buy-to-let landlords and investors.<\/p>\n","protected":false},"excerpt":{"rendered":"

The stamp duty holiday and low interest rates have enticed more small and first-time landlords to enter the buy-to-let sector. Fewer investors are relying on only cash to purchase properties. Data from major London estate agency Hamptons reveals 52% of landlords bought property with cash during 2020. This is the lowest figure on record. In… Read more »<\/a><\/p>\n","protected":false},"author":1982,"featured_media":15367,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[2,4],"tags":[22,201,15],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/posts\/6034238"}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/users\/1982"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/comments?post=6034238"}],"version-history":[{"count":0,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/posts\/6034238\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/media\/15367"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/media?parent=6034238"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/categories?post=6034238"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-hk\/wp-json\/wp\/v2\/tags?post=6034238"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}