As the property market looks set to recover somewhat in 2020, a new survey has revealed that many people still believe the buy-to-let market represents a worthwhile investment.
Some 75% of 1,000 people surveyed by Perrys Chartered Accountants backed buy-to-let, rising to 83% of millennials.
The main reasons why people might be put off from investing in property were Brexit uncertainty and increased tax and stamp duty rates.
The survey found that a better choice of mortgage products was the main reason which would encourage people to purchase a buy-to-let property, followed by reduced stamp duty. Over a fifth of respondents also expressed an interest in alternatives to traditional property investment such as short-term lets.
Prospective investors said that they were most likely to target a two-bedroom house, followed by a flat/apartment or house with three or more bedrooms. Only a very small number of participants said they would target overseas properties or a one-bedroom house.
Meanwhile, half of respondents said the main reason they would invest in the buy-to-let market is to fund their pension. This was followed by replacing current income and building an inheritance for family.
"It’s interesting that the younger generation still sees [buy-to-let] as a way to plan financially for the future. However, there are many things to consider before jumping in, including stamp duty charges, how income tax might be affected and what the return on the investment is likely to be," says Donna McCreadie, a buy-to-let tax specialist at Perrys.
"Investing in a property is a long term plan rather than a quick fix to financial freedom so it’s important to gather as much information as possible and speak to a professional tax specialist and mortgage advisor before making a commitment," she says.