Buy-to-let returns of 63% for UK investors

The UK is second only to Poland when it comes to the profitability of the buy-to-let sector, new research shows.

According to the Assetz Property Investment Tracker, which records buying costs, rental yields and capital growth for 14 investment destinations, the UK offers a total 63 per cent return on cash investment, second only to Poland's 165 per cent.

Following the UK to round up the top five came Bulgaria, France and Turkey.

The report stated that many investors would be keeping their money in Britain in 2007, benefiting from "strong and sustainable" housing market growth, with the six major house price indices showing average annual rises of 9.8 per cent for the 12 months to February.

Britain remains a "low risk investment destination", the firm said, with low purchasing costs and the option of avoiding management expenses through self-management.

"As first-time buyers are increasingly priced out of the market, demand for rental properties is likely to rise, providing a strong basis for buy to let investment," commented Assetz managing director Stuart Law.

New research from Paragon indicated that British landlords intend to increase their property portfolios by an average of 4.8 per cent over the next year.

Landlord Mortgages comments “Landlords have seen great appreciation in the last five years and are now exiting three and five year buy to let mortgage deals. This is the prime time for landlords to realise the appreciation in their buy to let properties and take advantage of better mortgage interest rates. Landlords buying Buy To Let properties is an inevitable outcome!”

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