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    Is Buy to Let Still Worth It In 2024?

    Despite some recent fluctuations, the UK housing market remains resilient, with savvy buy-to-let investors poised to capitalise on plentiful opportunities. Strategic planning and proactive management will be key to maximising returns in 2024.

    The pandemic forced the housing market to temporarily grind to a halt. Since then, as restrictions have eased and the market has begun to stabilise, we have seen a surge in activity amongst buyers, sellers and investors. Recent statistics point to an average UK house price increase of 20.4% between January 2020 and December 2022.

    Though price growth has slowed somewhat in response to fluctuating interest rates and inflation, factors like high housing demand and constrained supply underpin the foundational strength and resilience of the market. House prices have actually recently dropped, to the extent that they are plummeting at a rate not seen in over a decade, down 4.6% year-on-year. This should make any enticing prospective buyer take notice.


    Despite the rumour mill running rampant with housing market crash talk, this is purely speculation at this stage. As experienced agents keeping tabs on current market trends and insights very closely, we will be forthcoming if there is any such economic downturn on the horizon. 


    Buy-to-let investors have begun to question whether the housing market currently presents a good opportunity to take the plunge in 2024, and, to be truthful, they can. If approached strategically, you can see healthy returns on property investments on a buy-to-let basis. With guidance from professional, transparent estate agents like ourselves, you can position yourself to benefit lucratively, with your investments retaining enduring viability. This short guide explains everything you need to know at this stage.

    The UK Housing Market Shows Underlying Resilience

    The UK housing market has largely stabilised after a temporary period of volatility. Despite a minor price growth slowdown, ‌underlying demand still outweighs supply, so prices will likely hold steady and firm for the foreseeable future.

    In the 12 months to early October, house prices fell 0.8% due to reduced market activity. September 2022 saw the largest annual fall in UK house prices in 14 years, as revealed by data from Halifax Bank. This suggests that there is no imminent risk to the UK housing market for buy-to-let landlords at present. The number of year-on-year house sales fell, but agents are still seeing steady enquiries, and market activity remains healthy.

    As the cost of living crisis eases steadily and interest rates fall, more buyers and renters will enter the market. The underlying supply and demand imbalance suggests that house prices will remain relatively resilient while the market stabilises further. So, new and seasoned buy-to-let investors can feel reassured that a move for a property in this sector will prove worthwhile. You may just have to wait for the prime opportunity. 


    With the help of proactive estate agents like Julie Twist Properties and local buy-to-let tax advisors and accountants, you can focus on growing your portfolio and seeing healthy returns too.


    What else do buy-to-let investors need to be aware of going into 2024?

    Rising Interest Rates Present Strategic Opportunities

    The Bank of England’s base rate stands at 5.25%, which is increasing mortgage costs for landlords. However, while higher rates squeeze profits in the short term, the base rate will eventually fall as inflation inevitably drops. 

    While some buyers may baulk at the average two-year fixed-rate deal (6.4%, according to Moneyfacts, which is up from 2.9%, the average deal in December 2021), savvy landlords and investors are using this window to secure competitively-priced fixed-rate mortgage deals. By using their networks strategically, they can find lenders willing to strike competitive loans below the average rate.

    Some landlords see this as an opportunity to sell up, granted, but that doesn’t mean that those opting to let their properties out can’t maintain a positive cash flow. It certainly doesn’t mean that being a buy-to-let landlord is not financially viable in this current window. With the right financing strategy, you can still maintain a healthy cash flow. The key is finding value, controlling costs carefully, and regularly reviewing performance.

    Tax and Regulatory Changes are Manageable

    The UK Government implemented a 3% stamp duty surcharge on additional properties, including those purchased for buy-to-let purposes. Additionally, the gradual introduction of new schemes and incentives for landlords is being met with optimism rather than a backlash. Some may even see the new way of declaring income on tax returns, to cover mortgage payments, as more beneficial and less time-intensive.


    Furthermore, previously proposed mandatory upgrades to rental properties to meet minimum EPC standards have been put on hold, giving landlords additional breathing room. Improving the efficiency of properties remains wise to attract future tenants and ‌future-proof assets, but the u-turning on deadlines has given buy-to-let investors more thinking time to focus their property upgrade efforts.


    It has also paved the way for more buy-to-let mortgage enquiries given that the Government will – in the interim – subsidise a transition to greener homes and not put the burden of costs on landlords. 


    While tax changes have marginally impacted costs, allowances and lower-rate tax relief will help offset the impact. Longer-term proposals like the Renters Reform Bill could also give renters more impetus to begin househunting for rental properties. While landlords should still navigate this imminent bill with steadiness, if they maximise rental income and capital values while keeping rent amounts competitive, they could begin to see healthier returns.


    Closely monitoring interest rates and changing regulations will be key to evaluating the changes in the market. However, if planned methodically, buy-to-let undoubtedly remains viable.

    Tips for Making Buy-to-Let Work in 2024

    While the buy-to-let landscape has changed, property can still prove highly rewarding if approached strategically. Amid all market shifts, investors have to be flexible and respond proactively, rather than reactively.


    Prospective buy-to-let investors can maximise their chances of success through careful planning and strategy. Focusing on high-demand areas, finding value-added opportunities like auctions or run-down properties, minimising costs by lowering mortgage payments, using allowances where possible, and leveraging professional estate agent help will be key. Managing properties proactively, assessing performance regularly, and being ready to adjust as needed is also vital.


    With the right expectations and adaptable strategy, buy-to-let can continue offering lucrative long-term returns.

    Written By Annie Button

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