The student population and landlords who have built portfolios to incorporate a large element of student lets and houses in multiple occupation (HMOs) in and around university towns and cities across the UK have not had it easy over the past few years. Thankfully, schools and universities are now largely back to ‘normal’ and just about to start, or have started, the new academic year.

To coincide with this, Paragon Bank has revealed the locations where landlords letting to students can achieve the strongest yields. Analysing mortgage applications for properties located in popular student postcodes, the lender found that landlords providing student accommodation in towns or cities with just one university typically achieve the highest yields.

It’s fair to say that professional portfolio landlords are dominating the current BTL market as the number of ‘amateur’ landlords has slowly dwindled on the back of tax and legislative changes.

Landlords build portfolios in a variety of different ways over contrasting periods of time. Many professional landlords may have started their journey as more accidental ones but came to appreciate the potential of the BTL sector. Others may have entered this arena with a more structured and scalable plan and then there are some who have the ability to acquire whole portfolios in one fell swoop.

I can’t imagine there are too many transactions in the history of the UK property market which have completed within the ‘expected’ timescale, without any queries or without any combination of doubt, concern, stress, anxiety and complexity. Each and every transaction has their own quirks and this is driven by a multifaced process which contains many moving parts. Parts which include their own set of influencing factors. Then there’s the emotion of the vendors/buyers to take into account, plus the heavy financial burden and, importantly, a lack of knowledge around the purchase process.

As an investment vehicle, BTL properties have long been held in the highest of regard. However, in recent years, regulatory and tax changes have served to challenge profit margins and investment potential with all landlords having to evaluate individual properties within their portfolio and adapt/diversify if necessary.

With this in mind, it was interesting to come across new research which looked at the returns seen across 12 investable assets in the last year to reveal where money has been best placed in the current climate.

It has obviously been a bumper year for the UK property market, with house prices rising across the board. The average UK homeowner is suggested to have experienced a gain in capital to the tune of 9.3% in the last year alone. So how does this compare to other investable assets?

The BTL sector sits under a constant regulatory microscope, as evident by the array of tax and legislative change seen over the past five years or so. These changes continue to shape how many landlords are structuring their portfolios and have resulted in far more activity at the more ‘professional’ end of the landlord spectrum than at the ‘amateur’ end.

Arguably the largest impact from this has been the growth in limited company BTL lending. And this is showing no sign of slowing anytime soon, quite the opposite in fact. So much so that the proportion of landlords who plan to purchase their next buy-to-let property through a limited company has hit the highest level for three years.

The summer of 2022 could well be a pivotal one for the housing market and the private rented sector as rising living costs continue to impact a range of personal financial scenarios, affordability, savings pots and homeownership aspirations.

With house prices experiencing sustained highs, the pressure on potential first-time buyers is mounting and big decisions need to be made over whether homeownership might be an option or if a longer-term rental arrangement may be more preferable from a lifestyle and flexibility perspective.