One of the keys to a shrewd property investment is knowing when to act and using changing market conditions to your advantage in order to maximise your returns. This is something that can be achieved in the rental market at the current time.
Landlords across the UK, according to new report published recently by Paragon Mortgages entitled Private Rented Sector Trends, are enjoying a sustained level of demand. It said that only three per cent of buy-to-let investors in the UK are of the opinion that demand for their properties has fallen in recent months.
Some 41 per cent of owners said they felt tenant demand was either growing or 'booming' while another 51 per cent said that it's static at the current time, maintaining strong results that have been seen for the past few years.
"Our latest survey of landlords reveals that that the past quarter has been a stable and steady one, with just over a third of landlords saying they feel more optimistic about the prospects for their rental portfolios," said John Heron, director of Paragon Mortgages.
With this in mind, is now the time to invest in buy-to-let property and become a landlord in London? Perhaps not on its own, since demand has been sustained in the property market for some time (although the record high of £770 per month hit Nationwide last week is a strong factor). But when coupled with another metric, it may well be the perfect time to purchase property to let.
Reports have shown that although London property has seen wide scale price rises so far this year, the situation may well be about to change. As rents continue to hit record highs, prime properties in London are seeing their prices level off. So what does this mean?
For the savvy investor, rising rents and slowing house price rises should set alarm bells ringing. It's definitely a good time to invest in buy-to-let properties when this is the situation.
The fact that you can get your hands on a property for a low price point when rents are increasing means that rental yields, which are currently hovering around the five per cent mark, will be higher.
On top of this is the fact that the general election is predicted to cause some uncertainty in the British property market. With people unsure about which party will gain or retain power in May 2015, the property sector is expected to slow, with fewer people looking to buy homes. This gives a window for short-term gains to landlords, as anyone looking for a home will be more likely to rent.