Insurance News Archive

Buy-to-let opportunities 'will emerge'

There will be plenty of buy-to-let opportunities in the next year or so, an expert has claimed.

Lee Grandin, managing director at Landlord Mortgages, said it will be difficult to judge when the market has "bottomed out" but said investors are already managing to acquire properties for 20 to 30 per cent less than their market value.

He said this is a significant fall on the market values of a year ago but cautioned prices may actually drop further, so it comes down to what "you perceive to be a good deal".

Mr Grandin recommended investors focus on the rental yield a property is likely to generate and said up to a 30 per cent higher yield than a year ago can be expected.

He added: "Maybe the purchase price should be looking at six and a half to seven per cent yield and anyway, it is quite hard to get a buy-to-let mortgage if you've got a full yield.

"But there will be many opportunities to acquire cheap property over the next year or so or maybe longer."

It was revealed recently by Hometrack that property sellers achieved an average of 93 per cent of their asking price this April, compared to 95.7 per cent for the same month the previous year.

28 May 2008