Buy-to-let statistics revealed

Buy-to-let investors borrow an average of 73pc of the purchase price for their property investments, while one in eight borrow less than half, according to the quarterly ARLA Review and Index for Residential InvestmentMore than 40pc of these investors buy properties that are over 50 years old and less than a fifth buy new build and on average, investors expect to keep their properties for 17 years.

Buy-to-let investors borrow an average of 73pc of the purchase price for their property investments, while one in eight borrow less than half, according to the quarterly ARLA Review and Index for Residential Investment

More than 40pc of these investors buy properties that are over 50 years old and less than a fifth buy new build and on average, investors expect to keep their properties for 17 years.

The review is the largest independent survey of the private rented sector taken from 525 letting agents and 259 investment landlords during March - and this quarter's results seem to demonstrate that the buy-to-let sector is dominated by the long-term, mature investor.

Across the board, investment landlords report that tenants stay in their properties for an average of 18 months. This is irrespective of the length of the initial term agreed.


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Some 40pc said that tenants stay for more than 18 months. A further fifth reported their tenants as staying for over two years and only a third reported stays of less than a year.

Nearly a third of these tenants are aged between 23 and 30, a quarter is between 31 and 40 and nearly another third are over 40. One in eight is under 23.

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Adrian Turner, chief executive of ARLA, said: “Increasingly, renting is seen as a long term option across all age groups.

“We believe that this is a reflection of a competitive rental market, increasingly high standards of housing that meet aspirations and a desire for flexibility.”

The ARLA Index shows the annual rates of return for a cash purchase of residential rental property average 11.18pc.

For geared investments, the average is 21.68pc. These returns include both rental income and capital appreciation.

There is only a marginal difference reported in the returns from flats and houses.

The review shows that the proportion of landlords with houses of multiple occupation (HMOs) continues to fall.

In the last quarter, the number of landlords reporting HMOs at all fell from 54pc to 49pc.

Those leaving the HMO market cite bureaucracy, new rules, costs of alterations and licence fees as the prime reasons for their departure.

However, in the mainstream, it is clear that the vast majority of residential landlords are in buy-to-let for the long term.

Nearly two thirds, 65pc, claim they expect to hold on to their property investments for more than 10 years.

Less than 2pc see buy-to-let as a short-term speculation in property by holding their investments for under two years.

Even if house prices were to fall, the great majority, 86pc, of all investment landlords say they will not sell - 12pc are unsure and a very small minority of 2.3pc said they will sell in the event of falling prices.

Instead, nearly six out of 10 of the landlords who responded said they expected to buy more residential investment property over the next 12 months.

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