LOW INTEREST RATES TEMPT INVESTORS
10 March 2009
WITH interest rates and property prices low, buy to let investors are increasingly being tempted back into the market, says a report from Accord Lets in Birmingham and Leamington Spa.
And the latest cut in the interest rate announce by the Bank of England should provide a further spur.
"The maths aren't difficult," said Carl Mimmack, managing director of the privately owned specialist residential letting agency.
"People are no longer getting a decent return on their savings with the interest rate at 0.5 per cent. But if they invest that money in property to let they can expect a return of on average between four and five per cent in rental yield.
"And if they view their investment in the long-term they can expect capital appreciation too when prices start to rise again.
"Accord Lets is enjoying its busiest year ever. People need somewhere to live and when they're too cautious to commit to buying because they think prices will fall further, they stay in rented accommodation longer.
"Because of this we are seeing landlords adding to their portfolios and new investors coming to the market".
However, Carl stressed that the choice of buy to let property is crucial.
"Today's tenants are very clear about what they want and for what they will pay a premium. I urge anyone thinking of investing in buy to let to take advice first from a specialist agency such as Accord. We can advise on every aspect from finding a suitable property to finding tenants."