Silver buy-to-let landlords flock to the market

There’s been a rise in buy-to-let purchases made by older people nearing retirement age after the market reopened.

In the 12 months to July 2021 there was a 52% rise in the number of buy-to-let house purchases made by landlords aged between 60 and 64, a bigger increase than any other age group.

Richard Rowntree, managing director of Paragon Bank, said: “There was a distinct spike in the number of purchases made by those nearing retirement age once the housing market reopened in May 2020.

“There could be many contributing reasons for this trend, with low returns from savings and stock market volatility being a potential factor as this demographic seeks to boost retirement income.

“The pandemic may have also led to an increase in people around this age deciding to either take redundancy or early retirement, which would have given them potential access to a lump sum of money to invest, or they are simply experienced landlords who took advantage of the Stamp Duty holiday to lower their purchasing costs. Of course, sadly, inheritance can also result in a one-off cash boost.”

While the spike has been significant, as a proportion of the overall market this age bracket remained the second smallest, at 5.08% of buy-to-let purchases.

Most buy-to-let lenders cater for older borrowers, though they tend to take extra care to ensure such people are mentally sharp.

New buy-to-let house purchase by age of borrower
18-29 30-34 35-39 40-44 45-49 50-54 55-59 60-64 65+
%+ 2021 vs 2020 40 42 42 49 37 37 45 52 26
% Proportion of total
June 2020
9.38 12.97 16.02 15.19 14.45 13.54 10.3 4.72 3.38
% Proportion of total
June 2021
9.24 13.03 16.03 16 13.95 13.08 10.55 5.08 3.02

Landlords aged between 40 and 44 recorded the second highest percentage increase at 49%, whilst this group recorded the greatest increase as a proportion of overall purchases, rising from 15.2% of the market in the year to the end of June 2020 to 16% this year.

The third highest increase was amongst 55 to 59-year-olds (45%), whilst over 65s recorded the weakest increase at 26%.

Rowntree added: “While there was a sharp increase in older landlords purchasing new homes, it was also encouraging to see the majority of purchases in terms of absolute numbers being made by those aged between 35 and 50.

“This suggests that there’s a strong pipeline of younger landlords growing portfolios.”

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