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UK Buy-to-Let Needs New Landlords

UK Buy-to-Let Needs New Landlords

The demand for rental property in the UK is such that many experts are predicting that as many as 1 in 5 households will be living in rental property as tenants by 2016.

In order for this estimate to be accurate there will need to be an additional 1.1 Million more rental properties made available in the UK private rented sector.

Experienced property investors are expanding their rental property portfolios and the demand for rental property is so strong that many new property investors are being encouraged purchase property for longer term rental yields and become landlords.

UK PRS landlords are reported to control as many as 4.8 Million PRS rental properties throughout the UK, up from the reported 2.5 Million in 2002.

PRS rental properties in London account for 27% of all residential properties while social renting now accounts for just 24%.

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Bank of England Base Rate To Remain AT 0.5%

Bank of England Base Rate To Remain AT 0.5%

The Bank of England’s (BoE) Monetary Policy Committee (MPC) again voted to maintain the bank base rate at 0.5% last week.

The MPC have agreed to keep the bank rate at 0.5% for the foreseeable future.

The bank rate has stayed at 0.5% since 5 March 2009, a long-term low of over three and a half years. This means that interest rates on savings are low, but that in some instances mortgage payments have become lower and more affordable.

The Monetary Policy Committee also voted to continue with its programme of asset purchases totalling £375 Billion (GBP), financed by the issuance of central bank reserves.

According to the Bank of England, the Committee expects the announced programme of asset purchases to take another month to complete, and that the scale of the programme will be kept under review.

The last previous change in the size of the Asset Purchase programme was an increase of £50 Billion (GBP) to £375 Billion (GBP) on 5 July 2012.

 

For newer investors…..

 

What is the MPC?

MPC stands for Monetary Policy Committee. There are 9 members on the committee; the Bank of England governor, the two Deputy Governors, the Bank’s Chief economist, the Executive Director for Markets and four external members appointed by the Chancellor. Each member has an expertise in the field of economics and monetary policy and they meet once a month to set the interest rate.

What is the base rate?

The base rate is the interest rate set by the Bank of England for lending to other banks. This is determined at the Monetary Policy Committee monthly meeting.

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