Landlords selling up in England and Wales make huge profits

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Making a healthy rental return on their portfolio of buy-to-let properties is a key priority for many landlords. And now new research has revealed that some landlords are also cashing in by selling the homes they’ve been renting for almost decade for a significant profit.

Related: Want great rental returns? THESE are the UK’s biggest buy-to-let hotspots and the worst!

Figures from the Hamptons International Monthly Lettings Index (April 2019) showed that landlords in England and Wales who sold their buy-to-let homes in 2018 made an average of £79,770 more than they paid for them (before tax) after owning the property for an average of 9.6 years.

landlords selling up

Image credit: Katie Lee

However, further data revealed that some landlords made even more from their rental investments over a similar period. Landlords in the London Borough of Hackney made an average 98 per cent gain after just 8.9 years of ownership equating to a gain of £289,650. Similarly, landlords in South Bucks also made an average 98 per cent gain on their buy-to-let properties. This time it was after an average 9.3 years of ownership, and the average gain equated to £278,310.

landlords selling up

Image credit: James French

Impressively, all of the top 10 local authorities with highest average landlord seller gain (before tax) pushed past the 90 per cent mark, with the full ranking as follows:

Local Authority Region Average gain

£

% making a gain Average ownership
KENSINGTON AND CHELSEA London £      1,072,880 91 per cent 10.6
CITY OF WESTMINSTER London £         557,380 91 per cent 11.1
CAMDEN London £         433,560 95 per cent 9.3
HAMMERSMITH AND FULHAM London £         432,150 96 per cent 10.1
RICHMOND UPON THAMES London £         325,100 96 per cent 10.1
WANDSWORTH London £         317,820 96 per cent 10.0
ISLINGTON London £         296,300 96 per cent 9.3
HACKNEY London £         289,650 98 per cent 8.9
HARINGEY London £         278,410 95 per cent 9.3
SOUTH BUCKS South East £         278,310 98 per cent 9.3
landlords selling up

Image credit: Rachael Smith

Commenting Aneisha Beveridge, Head of Research at Hamptons International, said:

‘The average landlord who sold their buy-to-let last year did so for nearly £80,000 more than they paid for it.  Over the 9.6 years that the average landlord has owned their buy-to-let, house price growth has driven their gains, with prices having risen around 30% over the period.  But given lower expected future house price growth and tighter mortgage regulation, more investors are shifting their focus from capital gains to yields.

‘Rental growth accelerated to 2.1 per cent in Great Britain last month, the highest level since January 2018.  This was driven by a 3.9 per cent year-on-year increase in London rents.’

Related: A third of Brits are turning their back on home ownership — this is the surprising reason why

Has selling your buy-to-let property proved profitable for you?



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