A report from Paragon Mortgages has found that house prices are being pushed up by an increasing number of landlords buying up student properties before the start of the new academic year, which starts in September. It showed a 2.8% increase in house prices in property values during May, with the average property worth £156,887,compared to £137,112 in May 2004, which is a 14.4% increase over the past year.
Those investing in the North saw higher annual returns of rental income than those in the South. Eight out of ten regions saw increases in rental incomes over the last year. In terms of property type, terraced housing continues to give the best return of income to landlords, at an average of 7.3% nationally, compared to 6.3% for detached, 6.7% for semi-detached properties and 6.2% for flats.
Our view
This sector of the property market is relatively small and we can see its seasonal impact on property prices in certain areas but nothing more than that.