Guide To Buy To Let Mortgages

One of the most popular areas of property development in recent years has been the buy-to-let facility. Favoring both professional property developers, as well as savvy consumers who can afford to do this, it allows a mortgage to be taken out for the sole reason of letting the property immediately.

With recent figures showing the average price of a house in the United Kingdom now a staggering 167,000 GBP, it's becoming increasingly difficult for people to buy a home, especially in the first-time buyer's market. This has led to a dramatic increase in people choosing to rent a property, as opposed to buying, while they try and save for a deposit for a new home. Men and women are also choosing to stay single these days, as opposed to living with someone or marrying them, therefore leading to an increase in demand in the rental market as well.

The benefits of someone taking a buy-to-let mortgage out are numerous. With interest rates in the United Kingdom at a good high, buy-to-let is an excellent financial gain for those investors who have property that they are letting out. Not only do they own a property whose value is rising all the time, therefore it's a wonderful investment for the future, but they are still making money by charging rent on the property. Depending on the size of the house being let, this can lead to an extremely tidy profit.

For example, say you buy a three-bedroom house and the monthly mortgage is an average 1,000 GBP. If you rent that property out to three separate tenants as a house share, and charge a very reasonable 500 GBP per month per person, you're making an immediate profit of 500 GBP every month, as well as paying for your mortgage. You can see quite easily why buy-to-let is such an attractive proposition.

It's not just the traditional landlords who are benefiting, either. Whereas in the past you may have heard the word landlord and thought of a middle-aged businessman, now it's more frequently younger people who are joining this lucrative market. According to the National Landlords Association, or NLA, the market has changed considerably in the last few years and more and more young landlords are now the norm. With a yield of around six per cent in the British market alone, which in itself will see the average investor make a profitable return of over sixty per cent, it's not surprising that the buy-to-let market is attracting all ages.

Indeed, such is the popularity of this new way to own a property, the buy-to-let market in the United Kingdom is now second only to Poland in this particular area. And with the Polish economy not really allowing for any other option except to rent, this is proof indeed that this is just the start of an extremely profitable avenue.

About The Author-- Teacher Marks are Estate Agents in Central London who focus on practice of surveyors specialising in all aspects of Central London commercial property.

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