Is now the right time for buy-to-let investments?

 
Is now the right time for buy-to-let investments?

Success in the buy-to-let market can boil down to timing, and the ability to strike when the iron is hot to make the most of opportunities that present themselves to you as an investor - and it appears that one such period could be about to come to the fore in the near future.

Over the last year, the Help to Buy scheme has helped many people to get themselves onto the property ladder when they would not have previously been able to, and while it didn't have much of an impact on the income of buy-to-let landlords, the rumoured paring back of the scheme could represent a real opportunity for investors.

According to various sources, the government and the Bank of England could be set to intervene in the scheme, with chancellor George Osborne stating this week that the central bank is free to make any changes needed to protect the integrity of the property market. 

It comes after the Organisation for Economic Co-operation and Development raised concerns that there are mortgages now being handed to people who will have little chance of being able to pay them off in the future.

At first, the Bank of England had dismissed the idea of making changes, but one of its directors, John Cunliffe, has since stated that it may make moves to cool overheating prices.

Two of the proposals would include making it harder to access Help to Buy mortgages and halving the maximum purchase price under the scheme from £600,000 to £300,000.

The immediate effect of such changes would be a drop in the number of people able to get themselves a house through the scheme, and while this would mean fewer homes being sold, it would represent yet another opportunity for landlords.

The number of households being formed in any given year is unlikely to drop, and given that access to purchase would be reduced, it would mean demand for rented properties getting a serious pick up.

For those with money to spend investing in buy-to-let homes, this could represent the perfect time to get a slice of the private rented sector, with the chances of rising rental prices (thanks to demand) and the chance for a strong long-term return on investment a real possibility.