Where are BTL landlords most likely to buy property in the next 12 months?
Buy to-to-let landlords across the Midlands are most likely to acquire new property over the next 12 months, new research show.
A survey of almost 800 landlords conducted by BVA BDRC, on behalf of Paragon, found that almost a quarter – 24% – of landlords in the East Midlands plan to purchase property in the next 12 months, with 22% of West Midlands landlords also looking to add to their portfolio.
Other regions that showed high demand for property from buy-to-let investors included the North East and Yorkshire & Humber, with 19% of landlords in both regions looking to purchase.
Landlords in the South West (8%) and central London (9%) were the least likely to purchase property over the period.
Overall, 14% of landlords plan to purchase property, with the average landlord acquiring three new properties.
More than half – 52% – of those looking to buy property are targeting terraced housing, followed by semi-detached property (32%) and flats (26%).
A quarter of landlords also intend to buy a HMO during the year, reflecting the growing popularity of this property type, particularly amongst professional, portfolio landlords.
|% of landlords planning to increase portfolio in next 12 months|
|East of England||13|
|Yorkshire and Humber||19|
Those with larger portfolios expressed a greater desire to buy property, with the research showing that 8% of landlords with one property planning to purchase during the year, rising to 20% for those with 20 or more.
Meanwhile, 12% of landlords with between two-three properties said they will buy, whilst the proportion of landlords with between four-five (15%), six-ten (14%) and 11-19 (14%) properties looking to purchase was broadly balanced.
Richard Rowntree, Paragon’s managing director of mortgages, said: “The proportion of landlords looking to purchase new property has been largely consistent over the past two years, but we are seeing regional variations and also a greater propensity for portfolio landlords to invest in property.
“Portfolio landlords have adopted a number of strategies to adapt to the tax and regulatory changes of recent years and we’re seeing trends such as these landlords buying stock from smaller-scale participants as they exit the market, or targeting higher yielding properties, such as HMOs.”
The researched showed that nearly two thirds (63%) of landlords plan to fund their next purchase with a buy-to-let mortgage, whilst 17% will release equity from existing properties to generate purchase funds. Meanwhile, 18% said they would purchase property outright using previously invested funds.