Times are still tough for many small business owners. The cost of owning property for permanent use is beyond many SMEs, while consumer demand is yet to fully recover to levels witnessed before the UK’s economy went south back in 2008. Fortunately, concerning property, smaller firms may find that the boom in buy-to-let could get them a significant return on their investment.
At the moment, the only sizeable amount of property demand is for commercial and residential letting properties. As buying properties outright is beyond the means of many households and companies, rental is their only option. This makes becoming a landlord an attractive proposition in terms of making money.
Demand for buy-to-let mortgages is rising at an astonishing pace. The reasons behind this trend include historically low base interest rates set by the Bank of England and the guaranteed income that comes with charging regular weekly, monthly or annual rent on each property. Owning multiple properties can make perfect business sense if getting the right mortgage.
The property market isn’t in the best shape it’s ever been in. For about five years, it’s been in a state of flux largely due to sky-high prices fluctuating and the squeeze in living standards putting off buyers. Reluctance from some lenders to offer mortgages hasn’t helped matters either, although the popularity of buy-to-let is changing all that for now.
Many people who own buy-to-let properties can enjoy a number of advantages besides gaining regular income. The fact that landlords are self-employed means that they’re in control of their own destiny, while owning a portfolio of properties for commercial or residential use can boost someone’s business acumen.
Despite that, it’s not certain that the boom in buy-to-let could last. However, buy-to-let looks like a good option for many investors, as a spokesman from Totally Money said:
“It’s no surprise that buy-to-let is booming. Low interest rates are here to stay for at least a couple more years, meaning mortgage payments will stay low while savers suffer – the average savings yield is an abysmal 1.09%.
“With rental yields soaring upwards of 6% in parts of the country, buy-to-let is starting to look like a smart investment. If you have the capital then the rewards are very attractive – there are few other investments that come with an expectation of inflation-busting income as well as capital appreciation”, they added.
This helpful business information was sponsored by Totally Money.