London home to the lowest level of tenanted properties for buy-to-let investors

The newest analysis by London lettings and property agent,Benham and Reeves, has revealed that whereas a rental property with a tenant already in place could also be a fascinating characteristic for many buy-to-let investors, they’re seemingly to battle to discover this added bonus in the London market, with simply 2% of present listings providing a tenant in situ.

Benham and Reeves analysed present market information* the quantity of buy-to-let properties listed for sale throughout the market in England that include a tenant already in place and the way the availability of these funding alternatives differs from one area to the subsequent.

While yield is usually the preliminary focus for buy-to-let investors, one different pivotal issue that’s influential when it comes to a profitable funding is void durations. A powerful yield is nice, but when your property is topic to extended void durations with no tenant in place, it could possibly critically dent the return seen over the course of the 12 months.

Investing in a property with a tenant already in place is a technique to hit the floor operating, as not solely are there no preliminary void durations, however you additionally save money and time throughout the levels with respect to tenant discovering charges, in addition to the referencing and deposit course of.

However, the evaluation by Benham and Reeves exhibits that, in the present market, there are solely slightly over 11,000 rental properties providing the addition of a tenant in situ.

The North West boasts the largest abundance of pre-tenanted buy-to-let funding properties, accounting for 21% of the nationwide whole.

The South East ranks second at 16%, though Yorkshire and the Humber (14%), the East Midlands (13%), East of England (11%) and West Midlands (11%) additionally supply an analogous diploma of tenanted property funding alternatives.

Buy-to-let investments with a tenant in place are fewer and additional between in the South West and North East, with every area accounting for simply 5% of the nationwide whole respectively.

But it’s London the place investors could have the hardest time discovering the added bonus of an present tenant in place, with the capital home to simply 2% of all tenanted properties at present listed for sale.

Director of Benham and Reeves, Marc von Grundherr, commented:

“Void durations is usually a important thorn in the facet for buy-to-let investors and can critically cut back the incomes potential of their funding in the event that they drag on for too lengthy. So a tenanted property could make for a really interesting funding alternative because it permits a rental revenue to be generated as quickly as the deal has been finished.

While London is home to the lowest proportion of tenanted property availability for present investors, they needn’t fear. Such is the imbalance throughout the capital’s rental market that any out there inventory is letting at an outstanding tempo and to allow them to relaxation assured that in the event that they do deliver an empty property on the market, any void interval is probably going to be very brief lived.”