24 Sep

Landlords seeing profitable market

Landlords seeing profitable market

The rental market in England is proving very buoyant for landlords as rental prices increase.

A report from Direct Line for Business revealed that landlords are earning around £32 billion a year in rental payments - equal to nearly £2.7 billion each month.

Data showed that landlords with properties in London saw the largest income of £14 billion per annum. This was more than the rental markets in the North East, East Midlands, West Midlands, Yorkshire and East Anglia combined.

Outside of the capital, landlords in Leeds enjoyed strong incomes, followed by Birmingham and Manchester.

It is therefore no surprise that the highest average rents were found in inner London at £19,596 per year or £1,633 per month.

Moving away from London, Elmbridge in Surrey had the highest rents at £18,948 per year or £1,579 per month, followed by South Buckinghamshire.

Other attractive areas for those considering a buy-to-let investment included Bath and the Cotswolds with average yearly rents in excess of £11,000.

"Buy to let is becoming an increasingly attractive option for people as property prices continue to soar," said Jazz Gakhal, head of Direct Line for Business.

However, he stressed that it is vital that anyone considering becoming a landlord should be aware of the risks involved.

"Bad payers and potential damage to property are but just a few of the costs that can lead to landlords paying out 25 per cent of the revenues they receive in rental payments annually. Taking the necessary precautions such as letting through an agency and taking out landlord insurance can help to alleviate concerns and ease the rental process," he added.

Meanwhile, housing experts have requested that standards be introduced to prevent some landlords exploiting tenants.

The Chartered Institute of Housing and the Resolution Foundation believe there must be increased penalties for those unscrupulous landlords who do not meet basic guidelines.

Grainia Long, chief executive of the Chartered Institute of Housing, said it is crucial that the industry reflects the serious need to provide good service.

"These are people's homes we are talking about," she said.

"I want to see a situation where all landlords understand their obligations, meet their obligations, and are committed to professional standards."

The National Landlords' Association has also backed the recommendations.
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