paragraph –>
Demand is growing for buy-to-let properties across the north and north-east as investors seek to capitalise on good rental returns and the rising property market.
paragraph –>
paragraph –>
Local estate agent Galbraith has reported a boom in the buy-to-let market with a typical two-bedroom apartment in Inverness expected to sell for £165,000 with a prospective landlord achieving rent of between £750 to £775 per month.
paragraph –>
paragraph –>
Marsaili Macleod, a lettings adviser with Galbraith, says there are two key reasons why there has been a shift in the market.
paragraph –>
paragraph –>
Get in touch with Mortgage Broker UK today to discuss your residential and Buy to Let Mortgage requirements
paragraph –>
paragraph –>
Strong demand from tenants
paragraph –>
paragraph –>
“In recent years investors have been more interested in the holiday lets sector as these were often considered a more profitable option than residential lets,” said Marsaili.
paragraph –>
paragraph –>
“Now we are talking to more landlords who are interested in the core residential lets market for two reasons.
paragraph –>
paragraph –>
“Firstly, strong demand from tenants and lack of supply means that rental prices are rising and the landlord can pick and choose from waiting tenants.
paragraph –>
paragraph –>
“Secondly the value of the property itself will rise over the term of ownership because property prices have risen considerably in Scotland over the past two years.
paragraph –>
paragraph –>
“Many of our clients are planning ahead and investing in a buy-to-let property which will achieve good capital growth and fulfil their financial objectives while offering security.”
paragraph –>
paragraph –>
Lenders are currently offering capital and interest mortgages, or interest-only mortgages, for buy-to-let properties with monthly repayments lower than the likely monthly rental fee.
paragraph –>
paragraph –>
Discover our Buy to Let Mortgage Broker services.
paragraph –>
paragraph –>
According to Marsaili, this offers the potential to achieve a return each month even taking into account that a purchase of this kind is subject to the Land and Buildings Transaction Tax at 4 per cent on second homes.
paragraph –>
paragraph –>
And with the cost of borrowing remaining low, Marsaili also believes that this is playing a part in the market change as people are using it as an opportunity to invest in their future.
paragraph –>
paragraph –>
Low borrowing costs
paragraph –>
paragraph –>
“Although interest rates are rising, the cost of borrowing remains historically low,” said Marsaili.
paragraph –>
paragraph –>
“The potential returns in the buy-to-let sector are good, coupled with the likely significant rise in value of the property itself over the term of ownership.
paragraph –>
paragraph –>
“Clients are considering whether to buy a property which can be let now to a tenant and in five or 10 years’ time potentially made available to their children as a first home or for when they go to university.
paragraph –>
paragraph –>
“Having evaluated the returns from the holiday lets sector and the potential returns from residential tenancies, clients are choosing the residential lets market.”
paragraph –>
paragraph –>
Galbraith currently lets over 1,000 homes to residential tenants for clients across Scotland and the north of England.
paragraph –>
paragraph –>
By Rosemary Lowne
paragraph –>
paragraph –>
Source: The Press and Journal
paragraph –>
paragraph –>
Discover our Mortgage Broker services.
paragraph –>