A survey by the London School of Economics (LSE) on landlords, reported by the Financial Times in December 2016, has found that they are getting involved in the sector at an older age.
In 2016, 61% of landlords were aged 55 or over. This compares to 12 years ago when 24% of landlords were 55 or older. In 2004, the majority of landlords were aged between 35 and 54, but now most are between the ages of 47 and 66.
The academics at the LSE looked at the reason for this and noted that it is now harder for young people to buy their first home. With high house prices, it takes people longer to save for a deposit and this means that people are buying their first home at a higher age. The same process affects buy-to-let landlords.
A lot of landlords first buy a home for themselves before purchasing buy-to-let property. Others, when moving up the housing ladder, rent their first home.
The survey found that in 2004, 18% of landlords’ bought their first buy-to-let property during the previous two years, compared to 7% now.
The LSE reported that around half of landlords had no debt. This means that they will be unaffected by government reductions on tax relief on commercial mortgage interest payments.
The landlords more likely to be affected by tax changes are those with large portfolios purchased using many commercial mortgages. Some may create companies in order to save tax, but the LSE report says that only 3% of landlords have obtained commercial mortgages through companies.
