On September 24th, the concept of buy-to-let, as we know it, celebrated its 25th birthday. Unveiled by the Association of Residential Lettings Agents at a major event in London, buy-to-let was launched with significant fanfare and equally significant scepticism.
There were those who predicted nothing but bad tidings and turbulence for the somewhat controversial new concept. Some had even predicted the buy-to-let scheme to be relatively short-lived, particularly as it grew into a sector rife with misconceptions, misunderstandings, and misleading myths.
Fast-forward 25 years, and the UK’s buy-to-let sector is one of the most robust and attractive in the world. But what is important to remember is that buy-to-let is not exclusively about generating massive profits for those who bought the right homes at the right times.
It has also had a major social impact on countless communities across the UK that have benefited significantly from the private rental sector (PRS).
Disproportionate focus on profiteering landlords
All manner of shadows have been cast on the buy-to-let sector over the years, giving it a somewhat undesirable image for many. Oftentimes, criticism focuses on profiteering landlords, who are accused of making easy money at the expense of their tenants.
When you consider just how many multimillionaires the buy-to-let sector has made over the years, you see the logic in such associations.
What is routinely overlooked is the way in which buy-to-let landlords are simply running a business, complete with the same risks and responsibilities as any other venture. Not to mention the increasingly strict and complicated government policy designed to hit investors where it hurts.
Contrary to popular belief, making a success of buy-to-let business venture in the UK is not easy. It involves a lot of hard work, can be surprisingly stressful, and comes with an endless list of associated costs and tax liabilities. Not to mention the constant threat of further issues prompted by problematic tenants.
The majority of tenants are as amicable, responsible, and well-meaning as it gets. But there will always be a small minority that appears intent on making things as unpleasant as they can for their landlords. Anti-social behaviour, damage to property, ongoing rent arrears, and so on are all everyday issues private landlords must contend with.
Investment in quality housing
The UK’s private landlord community must also be credited with supporting the redevelopment of the private rental sector, which at one time was in a rather sorry state of collective repair.
In the 25 years since its debut, buy-to-let has seen billions of pounds pumped into homes of all shapes and sizes across the country. Today, it is illegal for a landlord to let out a property that does not guarantee a certain level of safety and good overall living standards.
For those who cannot afford to buy their own homes or simply do not wish to do so, the PRS continues to play a pivotal role in the UK’s housing landscape. Even today, it is a sector that still has unfair and unjust connotations, with greedy investors looking to make easy money at the expense of their tenants.