UK tenanted property is an increasingly popular form of property investment as it is a relatively quickly and easy way in which to generate an income, with the potential to make a capital gain upon sale at a later stage. Historically, tenanted property was generally associated with accommodation which was very run down and in a poor state of repair. Rents, which were often fixed, were at very low levels and tenants were very hard to evict.
The introduction of the UK Housing Act 1996 introduced legislation to make tenanted property far more appealing to property investors. Tenancies starting on or after 28 February 1997 are automatically shorthold tenancies unless special steps are taken to set up an assured tenancy. Landlords now have flexibility regarding the length of a tenancy agreement, the setting of rents (according to contract), and eviction of tenants.
The change in legislation has resulted in a large influx of property investors now investing in tenanted property. The quality of tenanted property is now generally of a good a standard.
Benefits of Investing in UK Tenanted Property
As the property is ready-tenanted, there is no need to advertise for tenants. Landlords gain the ability to receive rental income immediately as there are no ‘void’ periods where the property is empty. Additionally, tenanted property does not usually require initial furnishing, decorating or repair, which assists investors with minimising potential set-up costs which might otherwise be incurred.
A tenanted property has not only proved its ability to be let, but also allows landlords to see how tenants have cared for the property and check their payment history. Tenants who are keen to stay on in the property are often the easiest type of tenant to please.
Propertyinvestment.co.uk is a buyer’s adviser focusing purely on UK residential and commercial investment property. We specialise in sourcing property that is substantially below the market value. The majority of the property that we source is ‘off-market’, which typically is discounted by up to 30 per cent below the current market value, generating rental yields (incomes) of between 6 -10 per cent.
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