Recent news stories and industry research show that there has never been a better time to get into the buy-to-let market. However, recent events suggest that this may not be true for everyone, according to a leading finance guide called Business Moneyfacts.
New laws that are very different from the ones that have been around for a long time are going into effect today. Some houses with more than one family living in them will have to pay extra for licences and to follow rules.
Lee Tillcock, editor of Business Moneyfacts, says, "It's great that people are trying to make rented housing better, but investors may have to pay up to GBP1,250 for a licence and spend a lot on modernization. The National Landlords Association (NLA) has already found that 61 percent of landlords are less likely to buy HMOs.
"This possible problem for more investors comes right after the confusion over A-Day. Reports said that a lot of people who wanted to become landlords were waiting to get into the market and put their new investment in their personal pension. The Chancellor's decision to go back on his word and stop residential property investments from being held in a SIPP (Self Invested Personal Pension) has ruined the plans of many people who wanted to invest.
Even though there are still far more people looking for houses in the UK than there are houses available, buying a house to rent out can still be a good investment. Lee Tillcock says, "If anything, all of the above factors could mean that there are fewer rental properties available, which would mean that rental yields would go up." But newcomers should study the whole sector carefully and do their research on properties and areas before making a long-term commitment.
