Strong prospects for buy-to-let
Buy-to-let landlords anticipate a healthy 2006, with almost two-thirds
of investors looking to increase the size of their portfolios in the course
of the year. The Association of Residential Letting Agents’ (ARLA) year-end
review showed an upturn in the buy-to-let market for the second consecutive
quarter. After a marginal decline between June 2004 and 2005, the sector
returned to a strong position by the close of 2005, with optimistic prospects
for this year.
The ARLA survey also found that buy-to-let is generally seen as a long
term property investment policy, with only five per cent of landlords
investing for short term rental income. More than half of all investor
landlords are instead looking to establish a "nest egg" that
will provide healthy returns in 15 or so years. The rest revealed that
they are expecting a mixture of income and capital gain. The figures also
indicate a significant social development in which renting has become
the preferred option of many UK residents. Tenants are now staying in
rental property for an average of 16.8 months.
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