Believe it or not, the buy-to-let sector is probably more appealing now than ever. Some have indeed been scared off by having to pay an extra three per cent on stamp duty and the generally less hospitable tax environment. However, there are fantastic deals to be had for the canny investor who thoroughly researches the market and works with a local expert.
The rental market in New Malden is very robust. Rising capital values have led to moderate yield compression but nothing which would lead a professional landlord to alter their strategy. In some areas, yields have strengthened as rents have outstripped price inflation.
Over the last couple of years, the rental market in the UK has been levelling out. Whereas a few years ago, the best opportunities for landlords were in London other areas have started to see increasing rental yields as the number of people choosing to rent instead of buy continues to grow. In New Malden the average yield across all property types is 5.2 per cent.
Not all landlords are investors with large property portfolios; some are accidental landlords – people whose decision to rent their property is an action of circumstance, rather than design. One example is homeowners who use ‘Let to Buy’ to purchase a new home. ‘Let to Buy’ mortgages are aimed at those who would like to buy a new home but may not meet regular mortgage requirements. They receive a mortgage based on the rental percentage of their current home on the condition that the buyer will occupy the new property.
There are several factors landlords need to take into account before purchasing a buy-to-let property. Renters can be different ages, but the majority are young professionals who are unable to buy their own home. Young professionals often prefer to live closer to transport stations and local amenities so they can have a shorter commute.
The rental market is only going to expand further here in the long term, with predictions suggesting it will grow by a third by 2030. All signs indicate that the only way is up. If you are interested in buying a property as an investment or would like to know how much your current home is worth in the rental market, please pop into our office for a friendly chat. We are looking forward to hearing from you.
The annual split of sales by house type
This chart shows what contribution each of the main house types has made to total sales over the last few years. As you can see, there are some year-on-year fluctuations, but the broad pattern remains the same.
Prices by type over time
The average price of properties sold within a given time is a useful way of illustrating how much can change in relatively short periods. Here we see how things have changed over time for individual property types.
Main industries of work
You may not have thought much about the sort of industries that local people work in, but it explains a lot about our area. In this chart, we show the number of people working in each sector split into categories as determined by the Office for National Statistics.
