01/05/12 Rise In First-Time Landlords - Connells

An increasing number of first-time landlords attracted by the high yields buy-to-let properties are currently achieving are entering the lettings market, according to lettings agency Connells.

“A high demand for rental accommodation and a lack of supply of properties to let has helped to push up monthly rental values and the yields landlords can achieve. This along with lower house prices and a greater availability of buy-to-let mortgage products, makes buy-to-let a very attractive investment in the current economic climate,” says Tim Wardley, Divisional Managing Director for Connells.

The buy-to-let market is set to continue growing for the foreseeable future as an increasing number of people have to rent for longer. A recent Consumer Rental Forecast by Rightmove highlighted that 55% of tenants who took part in the survey would like to buy but can’t yet afford to. Figures from the survey also showed that a third of tenants expected to be renting for the next three years or more*.

When becoming a first-time investor, people need to ensure they instruct an agent that is a member of a recognised lettings body. They should also make sure they fully understand the processes involved in letting a property as well as the type of protection they need against, such things as, the regular payment of rental income and the return of deposits.

“Many people entering the rental market for the first time may be unaware that, if their lettings agent is not a member of an officially recognised body such as the Association of Residential Letting Agents, they are immune from any form of disciplinary action for misconduct,” says Tim.

For many years Connells has been a voluntary member of ARLA, which means they agree to abide by a mandatory code of practice that is rigorously enforced by an independent body. The agents are also members of the Tenancy Deposit Scheme.

“We currently have a situation in this country where anyone can set themselves up as a lettings agent, with no formal training or experience and no legal requirement to subscribe to a redress scheme. This is extremely dangerous for both landlords and tenants as these agents may be completely unqualified, have no knowledge of the complex legal and safety requirements and offer little support to landlord and tenants if things go wrong,” says Tim.

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