John Heron, managing director, commented: “Landlords are choosing to invest in buy-to-let because they are confident in the returns achievable. People have more faith in the value of bricks and mortar than ever before, and in addition, short term returns are on the up, with demographic factors fuelling tenant demand and rental incomes.”
Further evidence that landlords have more confidence in the returns achievable in buy-to-let than other forms of investment is revealed by the gearing of their portfolios. The research revealed that, on average, 63 per cent of a landlord’s portfolio is made up of property.
John Heron continued: “Buy-to-let is a popular investment option. Obviously every adviser would tell their client that the key to a good portfolio is to remain risk averse. Landlords are placing a slightly heavier weighting on the property aspects of their portfolios because they are confident in the returns that can be generated from buy-to-let, more so than other investments in the current market.”
The research also revealed that 28 per cent of new landlords stated that their primary reason for choosing buy-to-let was because they wanted control over their investment. Buy-to-let is an investment where market research and an ongoing interest are needed to obtain maximum returns, but equally a landlord is left with a tangible investment over which they have some control. More than other types of investment, buy-to-let offers the opportunity to have an influence over the returns generated – leaving the investor less exposed to external market threats.
John Heron concluded: “With recent volatility in the stock market, we have seen some investors increasingly looking towards investments over which they feel they have more control, such as buy-to-let.”
