Buy-to-let purchases made by older landlords nearing retirement jumped by more than half following the reopening of the housing market, according to data from Paragon Bank.
There was a 52% rise in BTL sales made to landlords aged between 60 and 64 in the year to the end of June compared to the same period the year before, following the introduction of the stamp duty holiday last summer. This rise was more than any other age bracket.
Landlords aged between 40 and 44 recorded the second-highest percentage increase during the pandemic at 49%, although this group recorded the greatest increase as a proportion of overall purchases, rising from 15.2% of the market in the year to the end of June 2020 to 16% this year.
The third-highest increase in BTL house sales in the year to June was among 55 to 59-year-olds, 45%, while over 65s recorded the weakest increase at 26%.
Paragon Bank managing director Richard Rowntree says: “There was a distinct spike in the number of purchases made by those nearing retirement age once the housing market reopened in May 2020.
“There could be many contributing reasons for this trend, with low returns from savings and stock market volatility being a potential factor as this demographic seeks to boost retirement income.
“The pandemic may have also led to an increase in people around this age deciding to either take redundancy or early retirement, which would have given them potential access to a lump sum of money to invest, or they are simply experienced landlords who took advantage of the stamp duty holiday to lower their purchasing costs.
“Of course, sadly, inheritance can also result in a one-off cash boost.”
Rowntree adds: “While there was a sharp increase in older landlords purchasing new homes, it was also encouraging to see the majority of purchases in terms of absolute numbers being made by those aged between 35 and 50.
“This suggests that there’s a strong pipeline of younger landlords growing portfolios.”
The bank compiled the survey using its own data and research from UK Finance.
