The proportion of landlords paying in cash for a property reached a ten-year high in January, according to the Countrywide Monthly Lettings Index.
Countrywide claims 61% of landlords purchased their buy-to-let property in cash during January, up from 41% and the highest since the index was started in 2007.
In 2007 just 41% of landlords bought a home without a mortgage, a figure which peaked at 58% by 2010 before dropping back, Countrywide said.
Landlords buying homes in the north of England were most likely to use cash to fund their purchase, while London landlords were most likely to use a mortgage.
|Yorkshire & Humber||68%|
|East of England||52%|
Overall, in January 2017 the cost of a new let was 2.6% higher than in the same month last year, the fastest January increase for two years, led by Wales the south-east and east of England.
New rents in greater London fell 2.7% and dropped 6.6% in central London.
|Region||Ave Rent Jan-17||Ave Rent Dec-16||Ave Rent Jan-16||December Rent YOY|
|East of England||£1,014||£1,014||£941||7.8%|
Johnny Morris, research director at Countrywide, said: “On average, landlords sell a home once every 17 years, meaning as prices have increased, a significant amount of wealth has built up in the sector. This is now fuelling cash purchases.
“With the forthcoming tapering of tax relief on mortgage interest payments, landlords have less of an incentive to borrow, suggesting more cash activity in 2017.
“Rents are rising at twice the pace of last January and there are signs that rental growth is starting to pick up in much of the country.
“Ten months after the introduction of the stamp duty surcharge, the number of homes on the rental market is showing signs of coming down.
“If this fall continues over the next few months, it is likely to support rental price growth.”
|Mortgages - Find cheapest. Rates from 0.98%. 1st time buyers, remortgages, self-employed, adverse & CCJ, Landlord buy to let. Compare now|
|Sell or Let Property FREE on Houseladder 0% no fees. Free property advertising. List 1 to 1000 properties to millions of buyers and tenants. Upgrade to a Premium advert for only £30 and sell or let your property FASTER! Create Ad|
|Make Money - Earn £250 to £2000+ per month part time. Get paid every month for work you do once. Work from home. Flexible hours. Free training. No experience needed. Major UK PLC company. Find out how >>|
|How To Save Property Tax - Updated Sept 2017 “How To Save Property Tax” is widely regarded as THE tax bible for property investors. The 21st edition has just been published (Sept 2017) and is completely up to date. Read now|