Landlords benefit from bumper 2007

Published: February 15, 2008

New figures have revealed that the UK buy-to-let property market is doing well.

Birmingham Midshires has published its Buy-to-Let Bi-Annual Review, revealing that total returns increased to 16.3 per cent in the year to December 2007.

This is up on the figure for the 12 months to December 2006, when returns equalled 13.5 per cent.

Buy-to-let investors also benefited from increased rental values in the year, with a rise of 13.1 per cent.

This translates to an average rent of £617 per month in 2006 to £698 per month in 2007.

"Rents continue to rise across the country, boosting returns," said Tim Hague, managing director of mortgages at Birmingham Midshires.

"The fundamentals underpinning the buy to let sector are sound. They include strong demand from higher immigration levels and housing affordability concerns for first time buyers.

"However, we expect house price growth to be more subdued in 2008, largely reflecting the impact of higher interest rates," he added.

The Association of Residential Lettings Agents recently revealed that rental yields increased in January.