20 things

Nationwide Buy-to-Let research

13 October 2007

• A report by Nationwide into the buy-to-let (BTL) market has indicated that 10 per cent of respondents to its study owned a second property in the UK.
• 14 per cent of people would consider buying a second property in the UK the study suggested.
• 66 per cent of respondents suggested that a lack of finance hindered their move to become property investors.
• Nationwide indicated that the most people felt that the prospect of good letting opportunities was a key factor.
• With the wider mortgage market experiencing a shift, the paper suggested that the BTL market was going to continue to grow, with more and more people looking at the opportunities available in the BTL market, both at home, and abroad.
• Looking at the UK BTL market and aspiring landlords, when looking at properties, growth in the area was a key factor when deciding on a location of a potential second property.
• 32 per cent suggested that proximity to shops and entertainment was a key factor when buying a second property.
• According to the Nationwide BTL index, 18 per cent or respondents said they felt that the area being a natural beauty spot was important.
• 22 per cent felt that being close to relatives was an important factor when deciding on a second property within the UK.
• 19 per cent of respondents indicated that the property being on the coast was an important consideration when looking at potential properties.
• Those living in the North West (75 per cent) were the most likely to own a second home for personal use the study showed.
• Residents of London (56 per cent) were more likely to have a second property to let out Nationwide revealed in its market study.
• A peaceful location was most likely to influence the purchasing decision of possible buyers living in the North East (100 per cent).
• Borrowers living in Scotland (30 per cent) were least likely to be concerned about this aspect when choosing a property, Nationwide highlighted in its BTL paper.
• Those from Northern Ireland who would not consider buying a UK second property were most likely to want to purchase a second property outside the UK (24 per cent).
• The Welsh (5 per cent) were least likely to consider buying a BTL property outside of the UK, Nationwide indicated.
• Commenting on the findings, Nationwide senior economist, Martin Gahbauer, said: "Purchasers of second homes - be they for personal use or to let out - are an important source of housing demand and have probably helped push up prices in many areas of the country. However, current market conditions may have an impact on this part of the housing market.”
• He added: "While second home buyers will often be able to draw on large house price gains from the past decade, this advantage is not available to local first time buyers, who face challenges in their attempts to get on the housing ladder. One must not forget, however, that second home buyers also make important contributions to the local economy through their support of local businesses."
• The Nationwide research was based on a sample of 1,000 respondents.
• The study was conducted by Marketing Sciences' Panelwizard for Nationwide Building Society (August 2007)