Malcolm Harrison, a spokesperson for the Association of Residential Landlords, explained that an increase in rental demands caused by a rise in single person households and “a softening of house prices” should help lift boost returns for buy-to-let mortgage holders in the coming year.
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Harrison added that as buy-to-let landlords tended to be cautious and well researched investors it is unlikely they will be worried about fluctuating interest rates.
“What [the buy-to-let landlord] works to is what the people who reinvest in rental valuation will give him in terms of actual rent. If that rent’s enough he’ll have a fix and he won’t be too worried either way on a fall in interest rates,” he said.
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According to research conducted by Birmingham Midshires, the average total return for a buy-to-let investor in 2007 was 16.3 per cent, up from 13.5 per cent in 2006.
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