The face of the housing industry has certainly changed as a result of national lockdowns. But how have the periods of lockdown impacted the buy-to-let (BTL) market?
First things first, how is the BTL market doing in the current climate? Well, the good news is, it’s doing relatively well.
Although during the first lockdown activity dipped dramatically due to the stricter measures, the second lockdown allowed buying, selling and moving in or out of houses to continue. As a result, the November lockdown had less of a negative impact across the board.
In fact, some of the highest activity levels in the BTL sector took place when the second lockdown was in full force. For example, research shows that during the third week in November BTL mortgage search volumes reached 94.4% of the year’s highest figures!
Demand from renters has also been impacted by coronavirus. Research indicates that demand in October reached the highest level of any October on record. As a result of this surge, rent prices outside of London hit a high, with the greatest increases in the North and South West.
Furthermore, the most sought-after properties in recently months have been two-bedroom houses or bungalows, knocking studio flats off the top spot they were on this time last year.
These trends seem to be direct results of lockdowns; spending more leisure and work time at home has led people to value outdoor space and separate working areas. Also, remote working has meant fewer people need to live in cities to be near the office. As a result, rural areas may be especially attractive if the bright lights of the city look a little dimmer with entertainment venues temporarily closed and higher numbers of coronavirus cases. However, recent research has identified Manchester as the top BTL investment location, so it will be interesting to see if it comes out on top again next year.
Lockdowns have certainly changed the mortgage industry, but it hasn’t necessarily stunted it. So, if you’re looking to make a BTL investment, don’t let the challenges put you off.
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Sarah Tucker, Founder/Director of The Mortgage Mum