The latest research from BDRC Continental’s independent Landlords’ Panel survey reveals that four fifths of Britain’s private landlords say their properties are their pensions. Here’s how they are planning for their retirement (questions were multi-choice):
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- 61% plan to live off the rental income
- 20% will sell some of the properties in their portfolio
- 5% will sell all of the properties in their portfolio
- 39% say their plans depend on the state of the market when they retire.
Many private landlords in the research view property to be a safer bet than investments such as pensions. Of the 10% of private landlords that used previously invested funds to purchase their property outright, a third said it was because they believe investing in property will produce a better return on their money (31%). Other reasons include providing an income (19%), acting as a long term investment and off-setting poor pension performance (both at 15%). 8% said property was an alternative investment. 6% believe property carries less risk than more traditional forms of investment, for example stocks and shares.
Mark Long, Director at BDRC Continental said “Landlords consistently tell us that they see their property portfolio as forming a critical part of their pension provision for the future. On average, landlords intend to remain active in the rental sector for another 15 years or so, and see a combination of capital gains and rental income as underpinning their pension strategy.”
Private Rental: A market view
BDRC Continental’s Landlords Panel has been monitoring the performance and sentiment of the private rental sector in Britain every three months since 2006. According to the latest wave of the research, optimism fell by six points compared with Q2 2012, meaning that in Q3 this year key confidence indicators almost exactly match the same period a year ago. However, the fundamental cornerstones of a strong private rental sector remain:
- Tenant demand was up +7% in Q3
- Yields up +0.5% to 6.7%
- Voids and arrears remain stable.
Mark Long concludes “Despite the challenging economy, the private rental sector remains resilient for most of Britain’s private landlords. In Q3 this year we saw further evidence of that as the number of private landlords with a single property making a loss fell by three quarters from 16% in Q2 this year to 4% in Q3, and although short-term confidence has taken a bit of a seasonal knock, I fully expect optimism to recover as we end 2012 and enter 2013.”
Further Information
These are a selection of findings from the Q3 2012 BDRC Continental/NLA Landlords’ Panel study. Fieldwork took place between 14th September and 1st October 2012 and incorporated 469 online interviews with National Landlords Association members.
