Buy-to-let sentiment bolstering rental market

This confidence has arisen despite ARLA members reporting an oversupply of properties in the rental market. This oversupply is a result of "reluctant landlords" who are entering the lettings market due to difficulty selling their house or flat.

Ian Potter, operations manager of ARLA, said: "The data shows that there are bargains to be had in the property market at the moment for those with a keen eye. This is substantiates our belief that buy-to-let remains a viable long-term investment vehicle.

"And whilst in general it appears that there is an oversupply of rental properties to let, this does not mean that in certain areas of the country there isn’t a shortage of property. It very much depends on the type of property, the experience of the landlord and the quality of advice they receive that makes the difference in identifying a good opportunity to invest."

The ARLA quarterly survey also showed that rental returns have remained largely consistent in the last three months since the previous report. The return on flats across the country is unchanged at 4.9% while houses are down slightly from 4.9% to 4.8%.

Potter said: "With interest rates at an all time low the figures speak for themselves. Flats clearly offer a sound return on investment against saving rates, particularly if you’re not looking for quick capital uplift.

"The signs are showing that it’s a buyer’s market at the moment, providing of course you can get the finance. But clearly the interest is there and lenders need to sit up and take notice.

"These figures do not represent a move back to the imprudent days of landlords being indebted to an irresponsible level and struggling to pay their many mortgages. Rather it shows that the buy-to-let market is going back to basics, to what it was originally meant to look like and achieve when it was set up some years ago."

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