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National Landlords’ Association warn against focusing on capital gains

The National Landlords’ Association (NLA) has highlighted the need to focus on long-term rental incomes when investing in a buy-to-let property.

Residential Property Investments UK

The National Landlords’ Association (NLA) has highlighted the need to focus on long-term rental incomes when investing in a buy-to-let property.

With capital appreciation having grown beyond expectations over the last two years and rent prices continuing to rise, buy-to-let property investments are becoming increasingly popular as a source of regular rental income, as well as long term capital gains.


The rise in capital appreciation over the past 24 months has seen buy-to-let property owners enjoy increased confidence in property values continuing to rise. Recent figures from the Financial Times place the capital growth of privately rented housing stock at £177 billion over the past five years.


A new report from the NLA has revealed that confidence in capital gains has increased to 52% over the past two years – nearly treble the previous 18%.


In spite of this, the NLA is urging buy-to-let landlords to consider their investment strategies by not focusing too heavily on capital gains.


Carolyn Uphill, NLA Chairman said: “It certainly feels like a great time to be looking at buy-to-let as a means of additional income, but you cannot simply rely on the prospect of capital gains as a strategy.”


The NLA reminded buy-to-let property owners that the buy-to-let market is primarily about providing homes for people, whilst capital gains are only beneficial upon the sale of a property.


Therefore, they advise that attention to ongoing rental income should be the focus for buy-to-let property owners, stating that sustainable rental returns are a more sensible investment strategy than focusing on a single capital gains windfall.

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