• 85% of UK investors plan to increase the size of their property portfolio in the next 5 years, with only 4% planning to scale back.
• The average property investor owns just under 5 properties.
• The average property investor owns 5 properties and makes a net income of £17,434 from their portfolio.
Despite the prospect of higher interest rates, 85% of property investors are planning to increase the overall size of their portfolio in the next 5 years, according to a survey conducted by The Property Hub, the UK’s most popular property investor community.
Only 4% of investors said that they planned to reduce the size of their portfolio.
Rob Dix, co-founder of The Property Hub, explains: “Although conditions are likely to be less favourable for investors in the coming years than they have been in recent times, UK investors are still optimistic about the long-term health of the sector.
“60% of investors say that they are motivated by rental income rather than potential capital growth. That income seems likely to be squeezed by increasing property prices, flat rents and more expensive mortgage payments, but investors still believe they can make an attractive return.”
The average investor makes a profit of £17,434 per year
After all costs (such as mortgage payments, repairs and letting agent fees), the average investor makes a profit of £17,434 per year – with an average of 4.8 properties in their portfolio.
Rob Dix comments: “Contrary to the common belief, most property investors in the UK aren’t making huge profits – a net annual profit of around £3,500 per property is fairly normal. There’s a perception that investors are living large off their rents, but in fact 77% of investors use their rental income to pay down their debt or fund future purchases rather than spending them on themselves.”
London, Yorkshire and the North West are the most popular investment locations
The survey found that London is still the favoured location for property investment (15.6% of all investors), although the North West (13.4%) Yorkshire and Humber (13%) are increasingly popular.
Rob Dix comments: “London has historically been attractive for investors because it’s seen as a “safe haven”, with consistently rising prices and high rents. But as London prices have spiralled away from the rest of the UK, it’s becoming difficult for investors to raise the capital to buy or make a return on their investment.
“As a result, more and more investors are looking to areas like Liverpool, Leeds and Hull where demand is still strong but yields are much higher. 45% of investors own properties in an area other than where they live, and we expect this to rise as southern investors look further afield in search of affordable prices and a good return.”
Results based on the responses of 156 property investors surveyed in October 2014.
For further information please contact:
Rob Dix, The Property Hub: 020 7193 4382 / firstname.lastname@example.org