You are here: Home - News -

Landlord and tenant growth boosts buy to let

  • 11/08/2003
  • 0
High prices are forcing more people to rent property, while landlord numbers are also on the up in l...

High prices are forcing more people to rent property, while landlord numbers are also on the up in light of poor alternative investments, according to lender UCB Home Loans.

This increase in both tenants and landlords has meant an unprecedented period of growth for the buy-to-let market.

UCB’s research highlighted good capital growth and rental return prospects as a major factor in the growing number of landlords.

Charles Reed, managing director of UCB Home Loans, said: ‘Low returns in the investment market, coupled with decreasing expectations from pensions, have been leading people to invest in buy-to-let property as a long-term method of generating both income and capital growth.’

The report notes landlords can generally expect to receive between 7% and 9% gross annual rental return in more active parts of the country, and nearer 5% in areas where house-price rises have slowed down and the ratio of landlords to tenants is higher.

Reed added: ‘Choosing to rent is becoming more acceptable for a wider group of people, particularly those who are young and single. Britain’s level of homeownership is one of the highest in the world, so perhaps we are becoming a bit more European and being more relaxed about renting.’

However, Stuart Wilson, mortgage development director at IFA, Inter Alliance, was cautious about using buy to let as a pension.

He said: ‘Like any investment, buy to let needs professional consideration. Everything that goes up can also go down, but as a pure investment in the long term, it offers sizeable contributions. Where else are you going to put your money?’

While current trends are pushing tenant numbers, Wilson said there would always be a large core to support the buy-to-let market.

He added: ‘There will be a group of people who will permanently rent, However, I am not sure it is through choice because many renters cannot afford to buy, and they would require a house market crash to buy.’

Recent figures from the Council of Mortgage Lenders (CML) show the buy-to-let market was worth £6.7bn in the last six months of 2002. This had increased from £4.1bn in the last six months of 2001.

According to the CML there were 275,000 buy-to-let mortgages outstanding at the end of 2002, worth just over £24bn.


There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.


Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.


Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.


Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
  • RT @robjupp: Great day yesterday for donations to @MortSleepOut. With Gift Aid, we are now close to £17,000. It would be great to get to £2…

Read previous post:
VIDEO: Your five minute guide to equity release…

Georgina Smith, managing director of equity release provider Stonehaven, separates the truth from the lies.