Expert opinion has it that the post-lockdown bounce in property prices will be short-lived and that there is likely to be a fall off in prices by the end of the year or early next year.
The Halifax’s July 2020 report of the RICS Residential Market Survey pointed to an ongoing recovery across the residential market with a rise in new buyer enquiries, as well has a rise in newly agreed sales.
However, experts are warning that property values will fall as the “true scale” of coronavirus becomes clear and the imminent recession, with its forecast dramatic rise in unemployment, as the furlough scheme ends in October, brings hardship to many.
An expert from Halifax has warned that eventually prices will fall again, and many people could even face negative equity again if there’s another property market crash, so what does this mean for landlords?
Russell Galley, Managing Director, Halifax, has said:“Notwithstanding the various positive factors supporting the market in the short-term, it remains highly unlikely that this level of price inflation will be sustained.”
Most landlords should be in a good position to expand given the increasing demand for renting, low interest rates, buy-to-let mortgage availability and the possibility of bargains to be purchased. It’s a matter of being patient, waiting to see what happens to prices later this year, and timing.
Zoopla’s research has come up with some interesting data that shows the current best buy-to-let hotspots in England, key locations where landlords should be thinking about investing their money.
The recent research found that Middlesborough in North Yorkshire is the top best place in England to invest in buy-to-let. This town provides investors with a gross rental yield of 7.7 percent, says Zoopla.
However, as it turns out, a cluster of the top buy-to-let hotspots, places for landlords to think about investing in the UK, are all in Scotland.
Zoopla identifies five out of the top ten UK buy-to-let yielding hotspots in Scotland as East Ayrshire, North Ayrshire, Inverclyde, Glasgow City, and Stirling all ranking above a 7.5% yield.
Next comes the North East with Sunderland District, County Durham and Hartlepool all achieving yields above 7% in what Zoopla dubbed the “investor triangle”.
Zoopla’s Top 10 UK Property Investor Hotspots
Middlesbrough 7.7 percent
East Ayrshire 7.7 percent
North Ayrshire 7.7 percent
Inverclyde 7.7 percent
Glasgow 7.6 percent
Stirling 7.5 percent
Sunderland 7.4 percent
County Durham 7.4 percent
Nottingham 7.3 percent
Hartlepool 7.3 percent
This research comes out of as Zoopla’s drive to attract buy-to-let investors to its online portal with the launch of a new “Investor Zooploma” section which aims to offer a range of expert advice to buy-to-let investors on topics from rental yield and legalities, to financial liabilities. Already the service has had over 10,000 sign-ups claims Zoopla.
Tom Parker, Consumer Spokesperson for Zoopla said: “With all of the top ten hotspots being in northern England or Scotland, it’s clear that the significantly lower house prices that characterise these areas, and come in well under the national average of £291,055, is playing in a role in the higher yields generated for investors.”