|Focus||Economy||Sales||Lettings||Stat of the Month
Landlords re-mortgaging for home improvements
A record number of landlords are re-mortgaging to release money to spend on their properties instead of trading up. In the last 12 months, out of the 171,421 landlords who re-mortgaged their buyto-let property, 9,523 did so to take money out to spend on their investment. This is up from 8,459 in 2017 and three times more than in 2016 (2,967).
The additional transaction costs incurred from the stamp duty changes for second-homeowners means more landlords are choosing to improve their properties, and hold on to them for longer to maximise gains.
In the last 12 months 5.6% of landlords who remortgaged released cash to spend on their property, up from 1.9% in 2016. The greatest increase was in the East of England where, in the last 12 months, one in 10 landlords (10.4%) who re-mortgaged, released money to spend on home improvements, a rise of 6.8% in the last two years. Every region across the UK has seen a rise, but regions in the South have seen the biggest growth in landlords releasing cash. In London, 7.4% of landlords re-mortgaging released money for home improvements, up 4.4% in the last two years.
Landlords in London also took out the most money to spend on buy-to-let improvements, £35,470 on average. This is over three times the amount an average landlord in Yorkshire & the Humber withdrew (£11,150). Across Great Britain as a whole, the average landlord re-mortgaging to make improvements took out £22,850. With fewer landlords buying properties, more are choosing to invest in their buy-to-lets to maximise their yields rather than trading up.