The start of every year sees newspapers, magazines and the internet full of those ‘New year, new you’ type articles encouraging you to give up the booze and eat healthily, or giving you ways of getting a six-pack in just seven days.
It’s usually around now, however, when the sound of new trainers pounding treadmills at gyms around the country falls silent as people realise that achieving that sculpted physique involves a LOT more hard work than they bargained for.
It can be difficult to keep yourself motivated, especially in the challenging times we’re living through at the moment, so to give us all a lift I thought I’d share some encouraging findings from the most recent BVA BDRC Landlords Panel survey, conducted in partnership with the National Residential Landlords Association.
To start with, levels of landlord confidence have edged up in several key optimism indicators over the past year, including rental yields, their own letting business and the UK private rental sector as a whole.
Then there’s profitability. Despite the challenges of 2020, landlord profitability remains high, with 88 per cent making a profit. The survey found that around a third of landlords make a full-time living from their portfolios, increasing to two in three for landlords with 20 or more properties. The average rental yield remained relatively stable in Q4 at 5.8 per cent, with HMO lettings continuing to generate significantly higher average yields compared to other property types at 7 per cent.
There was also an increase in tenant demand in the last three months of 2020, with 32 per cent of landlords reporting a rise – the highest level for almost five years. The proportion recovered strongly as the year progressed following a big decline recorded as a result of the initial lockdown and has now surpassed the levels recorded since Q1 in 2016.
Finally, fewer landlords are now intending to reduce the size of their portfolio in 2021. The proportion edged back to 20 per cent in Q4, down from 25 per cent in Q3. Of the 16 per cent of landlords who say they intend to buy a new buy-to-let property by the end of 2021, more than three-quarters said potential rental yield was the key attribute they were looking for, while more than half said the potential to add value was the most important thing to consider when searching for a new investment property.
To ensure that landlords continue to stay positive throughout 2021, it’s vital they know there are lenders out there who take a common sense approach, assess each and every case on its unique merits and can provide a solution tailored to customers’ individual circumstances.
Specialist lenders, including Kent Reliance for Intermediaries, are perfectly placed to help customers with challenging cases, such as those with less than perfect credit profiles and self-employed workers. We’ve got years of experience in handling scenarios and income types which high street lenders may turn down due to their ‘computer says no’ approach.
Kent Reliance for Intermediaries group sales director Adrian Moloney
