ARLA: Think of buy-to-let as a long-term investment
Posted by Sue Hopson
Those considering buying property to let in Bournemouth, Oxford or elsewhere should view it has a long-term investment rather than a way to turn a quick profit.
That is according to Ian Potter, operations manager at the Association of Residential Letting Agents (ARLA), who has said that buy-to-let properties should be held on to for at least ten years for investors to realise the full benefits.
"[Buy-to-let] is a long-term investment; it is not a quick buck," he commented.
"That is where a lot of people got bitten at the point in time where the property market crashed and the mortgages just effectively dried up overnight. They were working on a very short exit strategy.
"A landlord coming into it today should be looking at it with a view to a ten to 15-year term."
With rents across most of the UK on the up due to rising tenant demand, a lot of landlords are looking at expanding their portfolios, Mr Potter said, but that this is being limited by a lack of available properties.
"We are certainly getting figures that suggest that there are landlords looking to buy new properties and add to their portfolios, but one of the problems is that there is not the property for them to buy," said the expert.
Securing finance from mortgage lenders is another barrier to expanding portfolios experienced by many landlords, but Mr Potter said that funds are available for investors with sizeable deposits.
"[Access to finance] depends on the level of investment that the landlord is able to put into it," he said.
"There are mortgages out there if you have got 25 to 30 per cent investment coming from yourself. If you are only looking for up to 75 per cent LTV [loan-to-value] then there are mortgage products out there."
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