Above:Will the upcoming change in mortgage tax rules ever slow the buy-to-let industry?

Summary:

• August sales of buy-to-let properties in the UK increased by over 50% against last year’s figures
• So far in 2015, £25.62 billion has been spent on buy-to-let assets
• Property investment in the UK is being driven by a huge supply and demand imbalance, especially in the ever-growing buy-to-let sector

Buy-to-let sales totalled £3.31 billion in August, increasing 54.1% over 2014’s figures.

According to Equifax Touchstone’s analysis, year-to-date buy-to-let sales in 2015 have reached £25.62 billion, which is a rise of 30.4% in comparison with last year’s figures.

Iain Hill, Relationship Manager at Equifax Touchstone, said after promising signs of growth in the buy-to-let lending market over the past 12 months, he expects the upward trajectory to continue in the short-to-mid-term future.

He said: “It’s promising to see sustained year-on-year growth. The current favourable market conditions, supported by low interest rates and the greater capacity for lenders to offer mortgages, have encouraged borrowers to enter the market.”

Given that many landlords were concerned about the summer Budget’s tax changes to buy-to-let mortgages, the upsurge in activity is encouraging for the industry. It shows the compelling logic that is underpinning investment in the UK real estate market.

Average yields across the UK residential sector in the last three months have grown to 6.4%. This has been driven by a 10% rise in private rental rates since the start of the year, while current sentiment among landlords points to returns increasing further going forward over the next 12 months.

Furthermore, earlier this month it was reported that property prices in the UK have hit an all-time high. The data from Rightmove revealed the average asking price of a residential property increased by 0.9% in September and now stands at £294,834.

Source: Select Properties