September News: Buy to let and booming rental market
Analysis from the commercial insurance broker Direct Line for Business has suggested that buy to let properties are an increasingly attractive prospect for landlords in what it describes as a booming rental market.
Buy to let mortgages are those used with the intention of becoming the property landlord and have been on offer in the UK since the late 1990s.
The analysis comes from a composite of two separate areas of government research and statistics: first from the Office for National Statistics' 2011 Census, which is the most recent UK census; and from the Valuation Office Agency's Private Rental Market Statistics, released in June of this year.
With a figure which suggests that the market is booming, the analysis concludes that the total in rental payments taken per year across England is greater than £32bn.
The picture across England
The areas in which landlords collect the most rent are the boroughs of London, at £14bn per year the capital accounts for 44 per cent of the total rent collected across the country.
Outside of London, the picture is one of Leeds (£565m), Birmingham (£521m), and Manchester (£401m) as the three cities where landlords collect the most rent.
In terms of the highest average rents for an individual tenancy, London and the Home Counties also sit at the top of that scale. The average rent in Central London is reckoned to be £19,596 per year, nearby Surrey at £18,948, while many commuter belt areas such as Bath, North Somerset, and the Cotswolds all have high averages of more than £11,000 per year.
The head of Direct Line for Business, Jazz Gakhal said: "Buy to let is becoming an increasingly attractive option for people as property prices continue to soar.
"Landlords and potential landlords looking to take advantage of this should also appreciate the risks involved.
"Taking the necessary precautions such as letting through an agency... can help to alleviate concerns and ease the rental process."
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