The end of accidental landlords? - Buy To Let - News - Moneyfacts


The end of accidental landlords?

The end of accidental landlords?

Category: Buy To Let

Updated: 27/03/2014
First Published: 27/03/2014

This article was correct at the time of publication. It is now over 6 months old so the content may be out of date.

There was once a time when people would become "accidental landlords" simply because they were unable to sell their home. Rather than lose out altogether they'd reluctantly put their property up for rent instead, and during the credit crunch a large number of people became landlords for this very reason.

However, according to research from the Association of Residential Letting Agents (ARLA) it looks like this phenomenon could become a thing of the past, with the housing market revival ensuring people don't need to enter into the life of a landlord against their wishes.

Their latest quarterly report found that the percentage of letting agents seeing an increase in properties coming onto the rental market because they couldn't be sold has fallen to 13%, a figure which not only represents the fourth quarterly drop but also a significant fall from the high of 94% recorded in 2009, when the post-credit crunch property crisis was in full swing.

Arguably, this has been driven by the recovery of the housing market, with ramped up buyer demand and ever-rising house prices meaning most people will have no problem selling their homes – so accidental landlordship is no longer a necessary alternative.

Of course, that's not to say that the buy-to-let arena can't be lucrative. A lot of people still actively choose to make the transition to landlordship, either as a sideline or a sole form of income, with the ARLA survey also finding that a lot of landlords view their rental properties as long-term investments.

Ian Potter, managing director of ARLA, said: "The resurgence of property prices and buyer demand in many areas is reducing the number of so-called accidental landlords. Despite the reduction of landlords in this situation, wider investment in rental properties remains strong across the market. The shape of the private rented sector is changing once again, with long-term landlords returning to the fore."

The figures show that just 1.5% of respondents had become landlords to make a short-term capital gain over less than five years, with the majority (45%) seeking to benefit from both rental income and capital appreciation while 37% had done so to create a nest egg for their future.

Given that it still offers such a viable form of investment over the long-term, it makes sense to maximise your returns by finding the best buy-to-let mortgage that you can. The cheaper your monthly repayments the higher your overall profit will be, and whether you're an accidental landlord or a professional one, it's all about the profit.

What Next?

Compare the best Buy to let Mortgages in our best buy charts

Disclaimer: Information is correct as of the date of publication (shown at the top of this article). Any products featured may be withdrawn by their provider or changed at any time.

Related Articles

Number of parent landlords on the rise

The cost of renting is on the rise, but would it cheaper if you were renting from your own parents? Many children of property moguls will hope so, and with the number of parent landlords on the rise, it’s something more and more could benefit from.

Landlords: BTL mortgage rates are still falling!

The cut to base rate has had a welcome impact on mortgage rates, and it isn’t only residential borrowers who are benefiting: buy-to-let (BTL) investors are continuing to enjoy a fall in rates, particularly those looking for a longer-term deal.

Landlords – are you embarrassed about being one?

Becoming a landlord is often touted as a way to secure valuable income and build a nest egg for the future, yet once that dream has been realised, many property moguls are actually embarrassed to admit their vocation.