According to Mollie Milman, writing on the website SimplyBusiness.co.uk in May 2017, there are three reasons why it can still be profitable to invest in buy-to-let property:
1. Low interest rates
2. Demand by tenants
Many people want to purchase their own home but are finding it difficult to save up for a deposit. It can take them a long time to accumulate the deposit money and the other expenses needed to buy a home, meaning they are forced to stay longer in rented property. This is one reason why there is a high demand for rental accommodation.
3. Rental yields
Rental yields are a measure of how much rent a property receives in comparison to its value. It is much more profitable to invest in buy-to-let property in some regions than others.
The website, TotallyMoney.com, in its 2017 survey, found that some properties in the Liverpool L7 area can generate rental yields of 16.7%. These are much higher than some London boroughs with average yields of 5.5%. Poole in Dorset was the worst performing region at 1.4%.
Investing in buy-to-let property can be challenging. Buying property in areas with high demand for rented accommodation, high rents and reasonable property prices can generate good profits. A mortgage broker can source a low interest commercial mortgage for buy-to-let investors.