Over the last decade, buy-to-let investments have taken a slight hit. This could be down to a number of things – Property tax changes, stamp duty on second homes, or legal and survey fees. Despite these reasons, there still remains huge investment potential in buy-to-let investments at present and in the future, in a market that is still very much alive. The main reason there is still many opportunities in this type of investment is that the demand for rented property is currently as high as ever. According to the Guardian, government data revealed that the private rental sector has doubled in size since 2004. It continued stating that half of people aged 25-34 were privately renting, highlighting the popularity of renting

Renting over mortgage

Property investment. investing in repossessed and below market value property
Repossessions can often be sold for 30% under their market value, making them great investment opportunities

The negatives of this type of investment are somewhat counteracted by the fact rental demand is still very high and, if anything, increasing. Due to ever changing lifestyle and work demands, people today appear less likely to commit such a sizeable chunk of their income to one property. 30 years ago it was the norm to settle in an area from a young age and build a life around it. Compare this to the modern day: There are more opportunities to work overseas, and young adults lifestyle can be more diverse with many travelling for years before deciding to settle. For this reason, fewer people commit to ‘settling’ early on, and it is now the norm to rent for a proportion of your working life. The obvious outcome of these changes is that there is plenty of the population actively seeking rented property, so those that have buy-to-let’s will be more in demand.

Rising property prices potentially put people off the buy-to-let path because getting their foot in the door was simply too expensive. A way to minimise this barrier will be to try and find the cheapest property possible, these best deals are often found in repossessions. For instance, a case study reported by the Telegraph followed a 26 year old buy-to-let investor, Ryan Windsor.  Mr Windsor’s first property was a repossession, he bought the three bed terrace when at university for just £62,500.00, he now owns 11 properties. Without the opportunity to buy properties for such a low price, Mr Windsor may have never got the ball rolling with his first property. 

 

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