A new poll reveals the negative perception that Brits have of becoming a landlord, with 36% of UK adults saying it's extremely risky being a buy-to-let landlord.
Despite the negative perception, millions of buy-to-let landlords are reaping the benefits with data from HM Revenue & Customs showing that the number of buy-to-let investors in the UK is around 1.6 million, after an increase of 120,000 in 2014.
The research asked 2,000 people what their biggest concerns would be with investing in buy-to-let property. Making repairs to toilets (63%), and risking tenants damaging your property (63%) have been flagged as the key things that put people off being a landlord, due to unexpected and unforeseen costs. Two thirds (62%) also said being a landlord means you risk losing income when the property is vacant.
When looking at confidence in property investment across the UK, the key differences that the research has shown is that in London (39%) and the West Midlands (38%) the majority of the public believe the property market will continue to boom. However the least confidence was found in the North East (21%) and the East Midlands (26%).
It has been predicted that the new pension reforms that come into effect in April will lead to people investing in property and upping the number of landlords. The poll found that investment in student property is regarded as the best choice amongst the public, with 1 in 8 saying that if they were to invest in property it would be in student accommodation because of the incentives available to them in recent years. Behind this was retirement property (10%), and holiday homes (9%).
Purpose built student accommodation (PBSA) is a class of investment that means you have guaranteed income, management of tenants, property resale and outsourced repairs. These privately owned student halls provide a high standard of student living and are expected to be extremely desirable to those put off by the traditional risks and hassles of being a buy-to-let landlord.
James Harrington, business development manager at leading student property investment consultancy, Emerging Property, said: “Purpose built student accommodation is designed to mitigate the key concerns expressed by investors in this survey. Not only are they operating within a market that delivers far greater yields than traditional buy-to-lets, but also, as the result of onsite property management and guaranteed returns, provide a hassle-free passive income, with zero costs and complete peace of mind.”
The incentives that are offered through new property investment structures oppose the common perception that the public have of being a landlord. Harrington went on to explain why: “In 2014, we witnessed record university intake levels in the UK, with numbers exceeding half a million for the first time. With existing supply gaps, this is resulting in high demand and positive rental growth, which ultimately leads to improved yields and enhanced security. This trend is set to continue, with legislation, both at the national and local level, encouraging increased university intake and exacerbating demand for purpose built accommodation.”