Landlords increasingly see their buy-to-let property as a short-term investment instead of a retirement plan, a study by the Association of Residential Letting Agents, has revealed.

The contents of the article are not a surprise but it confirms what I thought. The following is a copy of the article as its only a short one.

http://www.mortgagesolutions.co.uk/mortgage-solutions/news/2284919/arla-half-of-landlords-looking-for-shortterm-exit

Whilst 75% of landlords surveyed saw their property as an investment, over half of new entrants to the buy-to-let market considered it a short-term investment designed to make the most of favourable market conditions.

ARLA president Susan Fitz-Gibbon said it was important landlords had realistic expectations of their returns: ‘The economic downturn has brought new entrants to the buy-to-let market and has also had an impact on the way in which existing players invest. With more landlords entering the industry, less experienced individuals need to ensure they have thoroughly researched and fully understand that there are risks and responsibilities associated with the role.’

The study found reluctant landlords – those forced to rent because they were unable to sell – represented 28% of new landlords in 2012, compared to only 18% in 2008-9.
Parents hoping to offer financial support to their children through a buy-to-let investment accounted for over a quarter of the market.

Short-term is relative. Properties are not liquid assets, and are likely to take 6 months to sell unless the price is attractive to investors, as they can complete much more quickly, and thats assuming there isnt a tenant! If there is it can take several extra months if the owner doesnt understand the legal process that has to be followed.

I do worry about the number of people who are becoming Landlords but who know absolutely nothing about the responsibilities and problems that are involved, let alone the legal and contractual issues, and the financial traps laid by low interest rates, property guru “snake-oil salesmen” and dishonest Agents

I need to get my message out…this is a complicated, time-consuming business with many risks & responsibilities. Many of these “investors” are little more than gamblers. They need help. A navigator through the shark-infested waters. I know a good one…

As a starter, become familiar with the Unfair Terms in Consumer Contracts Regulations 1999. This will sort out many of the clauses and claims for payment by Agents (albeit going to court is time-consuming aggravation).

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