The buy-to-let returns you can expect during 2024 – a landlord’s guide

With recent mortgage rate cuts market-wide and a renewed appetite for fixed-rate products amongst UK landlords, the start of 2024 has all the makings to be a promising year for the property sector. Historically, buy-to-let properties have always been wise investment choices. Yet, with recent challenges (and interest rate rises) wreaking havoc for all, weighing up the pros and cons is more important than ever for those looking to start or add to their property portfolios.

In this blog post, we take a closer look at what would-be or seasoned buy-to-let investors can expect during the year ahead.

A growing and stabilising market

After years of Bank of England (BoE) base rate increases, the property sector was in a sorry state, pricing many would-be landlords out of the market for some time. With the base rate holding at 5.25% since August 2023, and expected to remain the same into spring of this year, economic stability is finally being experienced throughout the market.

Mortgage rate cuts are already happening, making finance more accessible to the masses, including buy-to-let landlords. This accessibility can pave the way for investors to secure properties with more favourable terms, enhancing their overall return on investment in both the short and long term.

The big rental demand continues

Despite finance becoming more accessible for buyers and landlords alike, increasing property prices may leave many would-be buyers renting for longer. This is just one of the reasons why the demand for rental properties is continuing to grow, with changing lifestyles, economic mobility, and a growing preference for more flexible living arrangements other factors that have propped up the rental market.

Recent rises mean great returns

As well as rental properties continuing to be in demand for 2024, the profit to be made from rental income and potential capital gains certainly shouldn’t be sniffed at.

Rent rises were a hot topic during 2023, with landlords in the East of England profiting most from the market trend as Property118 describes:

“Tenants in the East of England faced the steepest rent increases, paying £153 more per month in December 2023 than a year earlier, a 13.3% hike. Rents in Greater London, the Midlands and the North of England also rose by more than 10% last year. The report predicted that rents would continue to rise faster than the pre-Covid average of 2.6% over the next few years, although at a slower pace than in 2023.”

Reduced mortgage costs mean there’s more to gain for landlords during 2024, especially those securing buy-to-let investments in the East of England.  

The future looks bright for landlords

Market growth and economic stability mean positive outcomes during the long term for landlords too. Alongside the advantages of securing a passive income stream with a buy-to-let, UK landlords will see their investments grow over time as the value of their properties appreciates.

While becoming a buy-to-let landlord is by no means risk-free and reward-heavy – with property management, tenant relations and the ever-changing regulatory landscape presenting their own challenges – recent developments make 2024 a particularly opportune time to venture into the buy-to-let market.

Need further advice and support with financing your buy-to-let investment? Contact our local mortgage advisors today to get started.