16:41 PM, 14th February 2012, About 12 years ago
Eight out of 10 landlords plan to supplement their pension income from letting property, according to the latest research by the National Landlords Association.
Landlords see buy to let as a way to increase their wealth and as a key method of generating a retirement income as an alternative to mainstream pension savings.
The survey also revealed landlords are increasingly pessimistic about the state of the economy, with financial confidence slumping to a record low of just three points, down from 11 points one year ago.
At the same time, Department of Work and Pension figures show the number of workers saving in a pension plummeted from 46% to 38% over the past decade – coinciding with the rise of buy to let.
The latest English Housing Survey for 2011 from the Communities and Local Government Department shows buy to let properties now make up 16.5% of all housing – with a total of 3.7 million homes.
Last year, landlords purchased 84,000 new buy to let properties on mortgages, according to the Council of Mortgage Lenders – reaching the highest level since the property bubble of 2007, although market activity is still only a third of the pre-recession market.
NLA chairman David Salusbury said: “Landlord confidence in the financial market is at an all-time low. This combined with record low interest rates means that many individuals are looking for alternative ways to secure their financial future.
“Letting property can be a sound long-term investment for those planning their retirement. Potential landlords must realise that letting property is a lot more complicated than contributing to a pension.
“Becoming a landlord is just like starting any other small business. Anyone considering using property to bolster their pension plans must make sure that they put together a long-term business plan, taking account of the various regulations governing the letting of property, as well as their responsibility to tenants.”
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