In fact, about 88% of professional landlords stated that they increased their investment portfolios in the past six months, with 25% planning to continue investing in additional properties within the next year.
In contrast, among smaller landlords who own one to four rental properties, only 58% increased their investment portfolios in the past six months.
The research indicates that many landlords aim to achieve portfolio diversification by purchasing properties in different locations (39%), and 37% are actively exploring different types of residential properties.
Additionally, 26% of investors stated they are shifting their focus to the student housing market, while 21% are interested in the retirement housing market.
The survey also pointed out that over the past 5 years, demand for rental homes has increased by 51%, while the number of homes available for rent has decreased by 30%, leading to a supply-demand mismatch in the rental market.
According to the analysis by mortgage lender Molo, Manchester is the UK city where property investors achieve the best returns, with an average total yield of 5.79% and a monthly rent of £1,316.
Leeds and Birmingham follow closely, with yields of 5.71% and 5.28%, respectively. These cities provide community and social opportunities for both living and working.
Although the UK property market faces challenges, the decline in mortgage rates is seen positively. Many experts predict that the highest mortgage rates may fall below 5% again, although the exact timing remains uncertain.
The rate reduction may encourage more homebuyers, but some potential buyers may adopt a wait-and-see approach, hoping for further rate reductions.
Meanwhile, the new construction industry will continue to face pressure. The latest data shows that during the April to June period of this year, only 8,000 residential projects received planning permission, with only 900 major residential decisions approved, representing an 11% decrease compared to the same period last year and reaching the lowest level in over a decade.
Although the market remains challenging, the current market is more predictable, allowing buyers to plan their finances more accurately. It's important to note that the market is currently on the rise, with increasing demand.
Overall, despite challenges in the UK property market, lower mortgage rates and relatively stable property prices are positive factors.
The decline in property prices in the new construction industry may attract more buyers in 2024, and the UK property market will continue to remain vibrant.
It's important to note that these analyses are based on data and some research findings and may not comprehensively cover all areas' situations. Specific market performances may be influenced by factors such as particular locations, dynamics of cash buyers, and segmented markets.
Looking ahead to the fourth quarter, if the Bank of England base rate remains unchanged, further interest rate cuts can be expected, providing more favorable financing options for homebuyers. Buyers can also anticipate lenders introducing more attractive, tailored mortgage products.
