The survey has been taken to give a snapshot of landlord’s views on the current state of the buy-to-let market alongside thoughts on the future of the sector, their intentions for their portfolios and how they are dealing with any potential difficulties.
Of those who responded the majority (81%) are positive about the future for buy-to-let with many suggesting the sector has now shed its former get-rich quick image and is once again a market of professional landlords.
When asked whether they planned to buy or sell some of their investment properties in the near future, 38% said they intended to buy, 13% said sell, while the majority, 53%, are content to sit tight with the properties they currently have.
A majority of respondents (59%) manage their properties themselves suggesting their role as buy-to-let landlord is a profession rather than a hobby, with 34% using the services of a lettings agent. 71% of landlords say the rental money they gain from their buy-to-let properties is sufficient to cover the mortgage payments, management and maintenance fees, while 15% say it is only enough to cover the mortgage. 6.1% said their rental income was insufficient to cover their outgoings.
55% said they had not experienced any rental voids in the last 12 months with 28% having to deal with a rental void in the last six months, and 17% in the last year. Finally, only 12% of respondents said they were using Rental Guarantee Insurance to protect against voids and rent arrears.
The survey was completed by 359 individual respondents and undertaken in November 2009.
Bob Young, Managing Director at CHL Mortgages, said:
“Our first quarterly survey of CHL landlord customers seems to show growing confidence in the buy-to-let sector and an overwhelming feeling that the market pain we have all felt over the last couple of years is starting to subside. In essence, the survey reveals that buy-to-let has gone back to its roots and is now a sector dominated again by professional landlords rather than the type of borrower we saw in the ‘boom years’ which were motivated by short-term ambitions as they attempted to make money quickly from property.
"Fuelled by some less than responsible lending these ‘landlords’ on the whole have been forced out of the market and the sector has returned to the hands of those looking for long-term returns. The fact that most landlords also manage their own portfolios shows the hands-on nature of this professional breed and it is likely that being a landlord is their primary profession.
“It is heartening to see that most landlords are positive about the future and a significant number are looking to purchase more investment properties in the near future. This shows a growing demand for buy-to-let mortgages and we believe will translate into increased lending in the next 12 months.
"All landlords will have experienced rental voids at some points but the professionals in the sector are in a much better position to ensure they are as short as possible.
"It is also encouraging that for the majority rental income is sufficient to cover all outgoings and in most cases deliver a yearly profit. In this current economic environment we are somewhat surprised to see the relatively low numbers using Rental Guarantee Insurance however we will track this in future surveys to see if take-up increases over the coming months.”
