Rise of the Virgin Landlord: Pop your B2L cherry with these top 3 investment picks
With lower house prices, rising rents and improved access to mortgage finance it’s no wonder that more and more Britons are looking to join the buy-to-let club. Indeed with UK GDP growing by a mere 0.6% in the three months ending May 2013 and many workers worse off in real terms as salaries remain frozen yet the cost of living continues to rise, securing supplementary income in the form of rental income is increasingly appealing.
- Virgin landlords looking to invest in 2013 at highest level in a year (Rightmove)
- Paragon Mortgages’ intermediaries saw 22% of B2L business from virgin landlords in Q1 2013
- Top 3 B2L investment picks from MyOnlineEstateAgent
Even despite average rental yields in the UK’s private rental sector falling by 0.1% last month according to Countrywide data, returns of up to 6.6%, as seen in Wales, are achievable driving more and more virgin landlords to enter the market.
According to the Rightmove Consumer Confidence Survey Q1 2013, the proportion of virgin landlords, looking to invest for the first time in 2013 was at its highest level for more than a year at 44%.
Improved access to B2L mortgage finance has also driven this sector forward with Paragon Mortgages revealing that intermediaries are seeing a steady increase in the number of first time landlords seeking finance. With echoes of the pre-recession boom period last seen in 2002, intermediaries saw 22% of business from virgin landlords in Q1 2013.
Indeed the latest figures from the Council of Mortgage Lenders indicate that buy-to-let loans accounted for 13% of the total 11.26 million mortgages approved in Britain in 2012, up from 9.8% in 2011.
Richard Patterson, Director of leading online estate agency, MyOnlineEstateAgent, comments,
“I have seen, both on a personal level through friends and family and professionally at MyOnlineEstateAgent, a rise in the number of first time or virgin landlords. The rapid growth of the rental market and sustained yields which can be achieved, especially from 3 bedroom family properties which are in high demand, makes B2L a popular investment choice.“
But with thousands of properties on the market, how do you choose the right property to pop your B2L cherry? Utilising his expertise and experience as a hands on landlord for 7 years, Richard Patterson shares his top 3 investment picks available on the market today:
1. 3 bedroom semi-detached house in Greater Manchester – Offers over £125,000.
Ready to let with no chain or work required, this property is a safe bet due to its strong transport links near the junction for the M60 and M62. A good family home which will be in high demand with more and more people turning to renting as they struggle to buy. Expected rental return of over 6.5% based on achieving a rental figure of around £700 per month. http://www.myonlineestateagent.com/for-sale/manchester/whitefield/brightwater-close-329/
2. 1 bedroom flat in Blackpool – Offers in the region of £59,000.
This spacious purpose-built 1 bedroom apartment with sea views is perfect for young professionals as a starter home or a retirement property. Neutrally decorated and secure with intercom access, the convenient location of this apartment, close to the seafront, shopping and Blackpool attractions, makes this a strong B2L purchase. Even if purchased at asking price, with an estimated rental income of £400 per month, the yield is over 8%. http://www.myonlineestateagent.com/for-sale/lancashire/blackpool/greystoke-court-338/
3. 3 bedroom semi-detached house for sale in London – Offers in the region of £229,950.
For investors looking for a B2L property in the Capital this 3 bedroom property in Lewisham ticks all the boxes. Newly redecorated, this family home, even if secured at an asking price of £229,950, should produce a yield of over 7% with estimated rent close to £1,400 pcm. In addition, with Lewisham recording an 11.9% annual price increase according to Land Registry figures (Q4 2012 compared to Q4 2011), this property should also deliver future capital gain. http://www.myonlineestateagent.com/for-sale/london/lewisham/southend-lane-1267/
For more information on these or other properties for sale please visit www.myonlineestateagent.com or call 0845 257 1101.