Buy to let bargains for sale as sellers cut pricesMake Text Bigger
Investment opportunities for buy to let landlords look good as mortgage availability increases and asking prices for homes continue to fall.
As the government lines up a first time buyer showdown with mortgage lenders and builders, property portal Zoopla reports sellers are dropping prices to a dwindling number of prospective buyers to try and secure a sale.
Landlords expanding their portfolios are grabbing 2,000 investment mortgages a week to take up the slack in the market.
Their target tenants are often frustrated first time buyers forced to rent because they cannot afford to put down a large cash deposit on a home.
Countrywide, one of the country’s biggest letting agents, has disclosed properties on the firm’s books let in an average 15 days.
The average selling price discount is £18,475, or 6.9% off the original asking price, compared with the reduction of £15,879, or 6.1%, reported by Zoopla in November.
The property portal’s research also revealed that well over a third (37.4%) of all properties on the market have had their price reduced at least once.
“As a result of weaker than expected demand in the last half of last year, sellers have progressively reduced asking prices to more realistic levels in order to achieve sales,” said Nicholas Leeming, commercial director of Zoopla.
“The traditional influx of new properties on the market at the start of the year has created even more intense competition amongst sellers.”
According to data from Rightmove, the UK’s largest property web site, the proportion of first-time buyers has fallen from 25.5% to just 22.8% in recent months.
This reflects less than half the number of first time buyers at the height of the market in 2007.
Rightmove said more than half of first-time buyers cite mortgage-related issues as their single biggest challenge in getting a foothold on property ladder.
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