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40% of landlords plan to hike rents

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30/01/2014
Four in 10 landlords in England and Wales intend to increase the rents they charge this year.

Research carried out by LSL Property Services, one-third of landlords said they wanted to raise rents by more than 1% this year with 56% stating they will do so to cover the cost of inflation.

Current yields for buy-to-let properties were 5.3% and LSL said many investors were choosing to invest in housing rather than the more volatile stock market.

Boosted by the growth in house prices in the past year the overall annual return increased to 8.8%.

The year ended with a 7.7% rise in the number of new tenancies, the report added.

David Newnes, director of LSL Property Services, said:

“Rising rents are delivering strong yields to investors, making a powerful case for the rental market for those in search of a beneficial, long-term investment.

“However buy-to-let investment is not a license to print money, and it requires the same level of research and planning as any other business investment. The success of the investment depends on the property remaining occupied to deliver ongoing rental income.

“Before taking the plunge it is important to be aware of factors such as the location of the property, which can determine the level of tenant demand. For instance, those nearest to transport hubs will usually be of the highest demand, especially in larger cities like London.”

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