0:02 AM, 3rd September 2024, About A year ago
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Professional landlords are increasingly turning to multi-unit freehold blocks (MUFBs) as a lucrative investment option, according to Shawbrook.
The lender has reported a 14% rise in landlords looking to invest in this property type in 2024 compared to the previous year.
Also, the value of mortgages being sought by landlords for MUFB purchases has risen by 37%, indicating that they are targeting higher-value properties while maintaining good leverage ratios.
The lender’s director of real estate proposition, Daryl Norkett, said: “Multi-unit freehold blocks are another attractive option for professional landlords looking to diversify their portfolios.
“MUFBs typically provide high rental yields, are in high demand, and tend to have a lower risk for void periods; all of which make them a popular choice for landlords.”
He adds: “In fact, we’re seeing this trend towards higher-yielding property types across the board with landlords increasingly considering property types like houses in multiple occupation (HMOs) and semi-commercial properties, which are similarly seeing a rise in activity due to their ability to provide a higher rental yield and shield against any economic challenges.”
Shawbrook says that Scotland has emerged as a particularly attractive location for landlords seeking to invest in MUFBs, with mortgages agreed in principle doubling from 3.1% to 7.4%.
The Northwest has also witnessed a significant increase in MUFB investment activity, with a 43% rise in mortgages agreed in principle.
The lender highlights that MUFBs generate diversified income streams and higher yields than a single unit can provide.
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