Quote Ref: WS1

From 20.00 on 17/08/2017 until 6.00 am 18/08/2017 – We are unable to process installment payments using the Close Premium Finance facility. This is due to essential system maintenance. If this affects you please email us at info@ukinsurancenet.com. We apologise for the inconvenience.

Amount of landlords buying cash properties hits a record high

Depositphotos25313133m-2015 (1).jpg

January 2017 was a record high for landlords buying cash properties, with 61% using cash to buy their investment - an increase of 2% from last year and 20% since 2007.

The Countrywide Monthly Lettings Index for January 2017 also showed that:

  • landlords in London are most likely to use a mortgage;
  • landlords in the North West are most likely to pay in cash;
  • rents across the country rose 2.6% in January 2017 but continued to fall in London.

Cash purchases are particularly prevalent at the top and bottom ends of the private rental sector with the most and least expensive properties most likely to be purchased in cash:

  • during the last year, 65% of investment properties costing less than £125,000 were paid for in cash;
  • 64% of landlords paid cash for homes costing £1,000,000 or more.

The data reveals that nearly a quarter (24%) of all landlord cash purchases were funded by the sale of another property elsewhere.

Johnny Morris, Research Director at Countrywide, said: “On average landlords sell a home once every 17 years meaning as prices have increased, a significant amount of wealth has built up in the sector. This is now fuelling cash purchases. With the forthcoming tapering of tax relief on mortgage interest payment, landlords have less of an incentive to borrow, suggesting more cash activity in 2017.”

We reported last month how landlords are turning to alternative methods of finance as a result of the introduction of tighter mortgage borrowing rules and stricter affordability tests.

There are currently no comments

Leave a Comment

* Indicates a required field