Buying frenzy could help landlords
Across most of the UK it is the stagnant housing market which is doing much to keep busy home owners with insurance for rented property as prospective buyers adopt a “wait and see approach”.
But not everywhere.
There is something of a buying frenzy going on in parts of central London with domestic and overseas purchasers competing for the best homes.
Property consultants Cluttons reports prices now exceed the mid-2007 peak by up to 20% in some cases.
Demand levels across the capital rose by almost 50% during March and April when compared to the same period last year.
James Hyman, partner for residential sales at Cluttons, said: “Activity levels in Central London are now picking up rapidly as buyers recognise that price growth is set to continue for the foreseeable future. They are keen to buy sooner rather than later, when the market is likely to be even stronger.”
Which, when you think about it, must be good news for landlords.
That is because a market that is heating up so much will push those unable to afford higher prices to purchase in another area or – if they want to remain in that area – to rent instead.
This, in turn, will force rental prices up as demand also increases.
Add to this the rising value of a landlord’s property and it puts them in a strong position.
But, while the market is favourable, landlords need to make sure that they still protect themselves in case things go bad by taking out buy to let insurance.