Landlords Opt For Multi Let Properties For Better Rental Yields

Thursday, October 30, 2014
Landlords Moving Away From Traditional Single Let Rental Properties

Landlords Opt For Multi Let Properties For Better Rental Yields

Landlords Moving Away From Single Let Rental
Properties For Better Rental Yields

Rental yields on traditional single let rental properties are falling, according to the latest  Complex Buy to Let Index commissioned by Mortgages for Business.

The third quarter of 2014 saw gross rental yields on single let rental properties average around 5.9%, the lowest level since the final quarter of 2013, down from an average of 6.3% in the second quarter and 6.4% in first quarter of this year.

According to the data, other property investment types are generating much higher rental yields for property investors and portfolio landlords.

Multi-unit freehold blocks, (MUFB), are now providing private sector landlords with an average gross rental yield of around 8.6% in the third quarter of 2014, up from the average 7.3% in the second quarter, marking the highest rental yield recorded for this type of rental property.

Houses of Multiple Occupation (HMOs) have also experienced a dip in average rental yield in the same quarter of this year, down to 8.9% from 9.3% recorded in the second quarter of 2014.This average rental yield is considerably lower than the record high of 11.8% set in the third quarter of 2013. Despite the fall, HMOs still provide an extra three percentage points above the more traditional single let rental property types.

The data shows that single let rental properties have not kept pace with rapid rental price rises in many areas and that the easiest property investments are not always the most lucrative.

Landlords with multiple tenants in rental properties can earn better and more reliable returns as part of a diversified investment portfolio, provided they have the one of the best buy to let mortgage products available to help them purchase the property.

The number of available buy to let mortgages on the market now stands at an all-time record of 707 separate buy to let mortgage products, at the end of Q3, this exceeds the previous record of 637 in the second quarter of 2014 and the 458 buy to let mortgage products at the end of the third quarter of 2013.

Competition between lenders in the buy to let mortgage market is keeping product rates low and facilitating a greater choice for landlords who should be preparing for bank rate rises expected in 2015.

Now is the time to take advantage of the abundance of low buy to let mortgage rates

Buy to Let Mortgages Are Not Difficult To Get

This was written by Mike Clarke. Posted on at 11:30 am. Filed under Buy To Let. Tagged , , , , , , , , , , , , , , , , , , , , , , , , , , , , , . Bookmark the permalink. Follow comments here with the RSS feed. Both comments and trackbacks are currently closed.