The Rental Market
Figures released by LSL Property Services showed gains of 7.6 percent in the private rental sector in 2009.
As such, landlords typically enjoyed annual returns of £12,740 on their buy-to-let investment; a figure far higher than what one might earn through interest offered by financial institutions or through most stocks and bonds. While approximately £7,909 of this return was derived from monthly rents, the remaining £4,831 can be attributed to the rise in property values experienced after the residential property market bottomed out nearly one year ago.
While these gains may still be modest in comparison to the boom years, they represent a very positive shift from the £23,000 in capital losses that landlords suffered in 2008, at the start of the financial crisis.
Residential property prices continue to rise—albeit by very modest proportions. If the 0.4 percent monthly increase in values remains steady throughout the year, LSL Property Services predicts that most landlords will enjoy annual gains of about 9.8 percent. This would amount to £16,000 in returns and an annual property value increase of approximately 4.9 percent.
David Brown, LSL’s commercial director, noted that those landlords who managed to expand their portfolios in spite of the recession stand to do very well this year. An added piece of good news is that arrears appear to be dropping in much of the United Kingdom.
Once you carry out your personal due diligence on any property presented to make sure all of your Investment Requirements are met, I am sure you will agree that 2010 represents a Fantastic Opportunity for Property Investing.
Article Courtesy of Ross Quin @ Morgan Grey
