Foundation Home Loans’ research has found that one in five UK landlords have entered the buy-to-let market without even planning to, finding themselves with a property ‘accidentally’ or through inheritance.
When asked how they first became a landlord, 14% stated this was via an accidental circumstance such as through marriage, relocation or other circumstance, meaning they are suddenly faced with different rules and regulations to understand. 9% of landlords inherited their properties, something that comes with its own complex tax challenges to navigate.
23% of all landlords questioned became a landlord purely for financial reasons, considering it to be an attractive investment, with 21% planning to use earned rental income to fund their retirement plans. 21% said they are full time and do not have another job, with the greatest proportion doing so in London as landlords recognise the ongoing demand for rental properties in the capital, stemming mainly from young professionals seeking properties within proximity to their workplaces.
60% of landlords do have another full-time job and are landlords in their spare time and 19% have a part-time job but spread their time among their various landlord duties. Regardless of how the circumstance came about, or how much time is spent on day-to-day management, 17% admitted they would be increasing the size of their portfolio in the next 12 months, having recognised the benefits from investing in buy-to-let.
Jeff Knight, marketing director of Foundation Home Loans, said: “With so much regulation introduced into the buy-to-let market in the last few years, it could be easy for those who are unplanned landlords to make a swift exit rather than stay and navigate the red tape.
“That said, no matter how they found themselves owning rental property, it’s clear landlords are interested by the buy-to-let market for a variety of reasons and objectives, financial or otherwise. Considering the rental sector forms an increasingly important part of the housing mix, landlords need to be armed with the right advice.
“Our findings indicate plenty of the ‘accidental landlords’ are looking to expand their portfolios and remain invested in the market, which will ultimately have a positive impact on quality and choice for renters.”