According to recent research by Just Group’s ‘My home, my future’, 25 per cent of Brits have used or are currently using the property market as a way of generating an income. When focusing on specific locations, 43 per cent of people living in London and 37 per cent of those living in the North East have been using properties as a source of income.
Stephen Lowe, group communications director at Just Group, said: “Broadly we found people in London were most likely to have used property to provide income with it becoming less likely with distance from the capital.
“The North East is the exception because the area had rates of remortgaging, providing lodgings and releasing equity that were more than double the national average.”
10 per cent said they generated income by investing in a property to rent out. 5 per cent rented a room via Airbnb, with the same percentage of people buying to remortgage, release equity from the property or to refurbish and sell.
41 per cent of those in urban areas have generated income from the property market. This is more than double the 18 per cent in suburban areas or 16 per cent in rural locations. There is also an age split with 44 per cent making money being under the age of 55, a huge comparison to the mere 13 per cent of those over the age of 55. What’s more, men are more likely to use property as a way of generating an income to women (29 per cent compared to 20 per cent).
The most popular reason given for people using property as an income generator was tied between supplementing their regular income and for home renovations (21 per cent each).
No income necessary
As for those who said they had not used property for the sake of generating an income, 45 per cent simply did not need it and 25 per cent did not want to deal with the stress of managing it.
Furthermore, 17 per cent were uncomfortable with such an investment, 12 per cent were unsure how they should go about it and 9 per cent had concerns regarding tax implications.
Lowe went on to add: “For many people, buying a home is a major ambition and their property will be their biggest asset.
“With longer lives and more responsibility on individuals to build up a pension, we would expect the use of property to supplement other income to increase in the coming years. How they do it could change significantly as the rewards and incentives change.
“Higher taxes on buying second properties and on rental income could lead to a slowdown in lettings, while more innovative and accessible equity release products could lead to more people in later life tapping into property wealth to meet their retirement aspirations.”
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