Property investors will be feeling battered and bruised by the continued introduction of additional costs and hurdles to the investment market. The additional stamp duty costs, tapered loss of mortgage interest relief and now stricter lending criteria have all increased the complexity and the cost of property investment.
On the face of it, its worked. There are fewer investors in the market and we have seen an increase in landlords selling up. This has meant that properties considered to be ripe for investment have become much more price sensitive with investors scrutinising yields and long term capital growth with far more intent.
The main area where I am seeing a change is off-market opportunities. Landlords who are considering selling their investment are increasingly looking to sell directly to investors without going on the open market. They want to reduce the risk of unsettling their tenants and suffering void periods. I currently have several off-market opportunities that have come directly to me. This is a distinct change from recent times where landlords have been focussed on going to the open market to achieve the best possible sale price.
For those investors still in the market, there are good opportunities out there. Off-market, fully let deals are attractive as they are less complex and offer immediate returns. The structure of the property investment market may be changing, but it still provides for a solid, long term investment.