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Buy-to-let investment still promises good returns for landlords, especially those who are willing to adapt to the new changes affecting the sector.
According to a report carried out by the Centre for Economics and Business Research (CEBR), good investment opportunities are still there for the taking, and landlords who adapt will be able to take advantage of a predicted increase in tenant demand.
The buy-to-let sector has had to absorb a number of changes in recent years, including an additional 3% stamp duty surcharge on the purchase of second properties, and limits placed on mortgage interest tax relief.
This may mean a slight fall in rental returns, but the 'rental revolution' and the potential for capital growth should help many landlords stay afloat.
Stephen Johnson, Managing Director for commercial mortgages at Shawbrook Bank, which produced the report, said: “As with all market shifts there will be winners and losers, but it is most likely that professional landlords with equity and scale from larger portfolios will be better positioned to weather the changes."
He continued: “Buy-to-let has produced excellent total returns for property investors in the past, and notwithstanding some of the new challenges, the fundamentals still remain compelling for those who adapt to the new environment.”
Landlords are being advised to look at how they can diversify and adapt best to the changes, while making sure they know how the changes will affect them. But the important point is, that landlords can still make good returns from buy-to-let if they make the necessary adjustments.
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