Buy-to-let landlords estimate earning 13% from their investment on average

February 02, 2015, 8:45 AM GMT+0

Buy to let landlords estimate that they make an average of 13% from their investment, although their motivation to be a landlord makes a difference to their profits, new research from YouGov shows.

The Buy to Let report spoke to almost 1,000 buy-to-let mortgage holders. It found that “Investor” landlords, who see letting out property as a financial exercise comparable with buying a financial asset, are most likely to see the greatest returns (an estimated average of 15%). The group with the second-greatest estimated returns are “Nest Egg” landlords, strongly focused on building a financial asset for the future (12%). “Accidental” Landlords (who fall into letting because they cannot or don’t want to sell the property they were living in or own) fare less well (11%).

Landlord motivation has also had a knock-on effect on tenants. While over four in ten (41%) buy to let landlords have increased rents over the past two years, the group most likely to have achieved an increase are “Investors”, almost half of whom (49%) have seen a rise. By comparison, “Nest Egg” landlords are second most likely (38%) followed by the “Accidental” (27%).

Tom Rees, YouGov Reports Associate Research Director, said: ‘Research and careful planning of a property investment appears to pay in the buy to let market. “Investor” landlords appear to earn higher returns than “Accidental” landlords. In part this is because these landlords take a more professional approach to owning property and view their properties as investments. Subsequently they have been better positioned to raise their rents recently – or, at least, they have been more willing to.’

Find out more information on the Buy to Let report

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