Buy-to-let investors focus on London

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by Gill Montia

Young Group, the property portfolio manager, has published its latest index, covering the first quarter of 2008.

The report gauges market sentiment within the buy-to-let sector and is based on a survey of 500 active investors who hold UK investment property.

The survey found that 86% of respondents believe residential property values in London will rise or remain static over the next 12 months (compared to 82% in Q4, 2007)

Thirty-nine per cent of investors were confident that UK residential property values outside London will rise or remain static over the next 12 months and 95% intend to hold their residential property investments for at least the next 12 months.

Fifty per cent of investors intend to buy residential property investments within London during the next 12 months, whereas only 6% of those surveyed intend to buy UK residential property outside London.

Eighty-four per cent of respondents said that the proposed changes to Capital Gains Tax have had no impact on their investment plans or behaviour.

Finally, 89% of investors expect the Base Rate to be below 5.00% in the first-quarter of 2009.

Neil Young, chief executive of Young Group, comments: “As purchase transaction volumes in the residential property investment market reduce, it is increasingly evident that the London market is distinct from that of the UK as a whole. Both property and rental values in the capital are cushioned from the cooling in the housing market, buoyed as a result of the inherent disparity between supply and demand.”