Over 50s flock to buy-to-let for high returns, but landlording is not without its challenges, research of 10,141 over 50s reveals

Britain’s Saga generations are laying claim to the buy-to-let market and many are reaping the financial rewards in the process, although doing so is not without its challenges according to new research from Saga Landlord Insurance.

Around one in ten over 50s are now taking advantage of the opportunities property rental offers* and those considering becoming “grandlords” have reason to feel optimistic, as on average over 50s estimate that they make almost £700 profit a month from letting a property. However, success is not guaranteed as one in ten said they were just breaking even or making a loss.

A third of respondents became “grandlords” in the last five years and while some people think being a landlord is tougher than they had expected (24%), one in ten said they found it easier than they thought they would. This may be because only 45% actually bought the property with the specific purpose of renting it out as one in seven (14%) inherited the property and one in 14 (7%) purchased it for a child or grandchild to live in.

To Let Sign

Grandlording does cause some day-to-day worries. The top concerns are renting the property out to bad tenants (36%) and managing the property as you get older (19%). And perhaps people are right to have some worries as a previous Saga survey showed that a third (32%)** had experienced problems with tenants paying rent, a quarter (27%) had experienced damage to the property and one in ten (11%) had needed to take legal action against tenants.

While Saga Landlord Insurance addresses some of these concerns, it has also produced a guide [1] to help people who are landlords or are thinking of becoming one. The guide offers top tips on deciding whether grandlording is right for you, how to pick good tenants and when it is the right time to increase tenants rent.

A specialist landlord insurance policy, such as that offered by Saga, can help protect against the many risks of renting out a property.  This can include cover for malicious damage, unlimited legal advice and optional rent guarantee to provide peace of mind.

Sue Green, Head of Landlord and Home Insurance, Saga says:

"Buy-to-let is an increasingly popular investment for the over 50s, particularly in the current financial climate but clearly it is not without challenges. The recently announced cuts to tax relief for buy-to-let landlords, for example, are a new factor that people will have to take into account when deciding whether to start letting a property.”

“Our research shows that, while landlords are largely positive about their decision, they are also likely to face practical and financial hurdles. This is why we have developed a guide that provides practical advice to grandlords, helping to address the most commonly raised concerns and giving them peace of mind so they can focus on enjoying their retirement.

[1] www.saga.co.uk/insurance/home-insurance-products/landlord-insurance/grandlord-guide.aspx

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