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What Do Landlords Look For Most in an Investment Property?

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    UK Landlords Report ‘Cautious Positivity’ for Year Ahead

    The latest UK Landlords’ Report from specialist finance brokers Finbri reveals some interesting data about the current rental market from landlords’ perspectives.

    From January to March, they surveyed 755 landlords in the UK to gauge their attitudes toward various hot topics affecting the private rental sector.

    They found a ‘cautious positivity’ for the rest of 2024. Most landlords (58%) do not believe they will have issues surrounding the affordability of buy-to-let mortgages this year. Over half of UK landlords plan to invest this year (51%), while 20% are undecided.

    Most landlords (71%) saw a rise in demand over the past year, and 51% said they plan to increase rent to cover additional costs. On the other hand, 60% responded that they would consider reducing rent to hold onto reliable tenants.

    Let’s examine how this affects buy-to-let property investments in 2024.

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      Location is Still the Most Important Factor to Consider for Landlords

      Another section of the report provides a breakdown of the factors UK landlords consider the most important when selecting the perfect investment property.

      Finbri has created a list of the top 5 most desirable factors for a real estate investment by ranking the features marked as’ very important’ and’ important’ by most landlords.

      The old adage still holds as location came at the top of the rankings, with 92.19% stating they think where the property is situated is very important (66%) or essential (26%). 0% responded that location is not important.

      The second most important factor was price, with a fractionally lower proportion of respondents (92.06%) considering it a high priority. Marketability (87.15%) came in third, followed by capital return (83.71%) and rental yield (82.52%).

      Further Reading: View some of the best buy-to-let areas and learn more about the costs of buy-to-let with our expansive market insights!

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        What Makes a Great Buy-to-Let Investment Location?

        So, how can UK property investors determine the best location for a buy-to-let investment?

        Some of the most common considerations are capital growth potential, rental yields, and rental demand.

        Capital growth potential can be gauged by looking at historical price inflation data and expert forecasts. According to Savills’ Residential Market Forecast, the North West has the most promising outlook for price growth. The region is slated for an increase of 28.8% in the next five years leading to 2028, higher than the UK’s average projected growth of 21.6%. It’s also worth researching local regeneration and development schemes which may boost house prices in the area.

        Research can also help determine regions and cities with the highest rental yields. Zoopla’s list of top buy-to-let locations in the UK states that Liverpool has an average rental yield of 7.44%.

        To learn more about the UK property market, check out some of our recent buy-to-let guides:

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        Jessica Ferris

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        Jessica Ferris is a property writer at RWinvest, helping our readers stay ahead of property market trends with the latest news and statistics.