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Growth in buy-to-let purchases by older landlords

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15/10/2021
There's been a sharp rise in later life landlords, but they still account for a tiny proportion of the total
Growth in buy-to-let purchases by older landlords

The number of buy-to-let house purchases made by later life landlords increased by more than half following the reopening of the housing market, according to Paragon Bank.

The buy-to-let lender said the 52% surge in investment purchases by landlords aged between 60 and 64 in the year to June 2021 was more than any other age bracket.

Despite seeing the greatest growth, later life landlords remained the second smallest age bracket when it comes to buy-to-let purchases, accounting for just 5.08% of the total.

Richard Rowntree, Paragon Bank managing director, said: “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.”

40-something spike in buy-to-let business

Landlords aged between 40 and 44 recorded the second highest percentage increase at 49%, followed by 55 to 59-year-olds (45%).

But it’s younger buyers who account for the biggest proportion of buyers.

Rowntree added: “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.”

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