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Investors in it for the long term.

Buy-to-let investors borrow an average of 73% of the purchase price for their property investments, while a sizeable minority ( one in eight ( borrow less than half.

On average, investors expect to keep their properties for nearly 17 years. These figures were published this week in the quarterly ARLA Review & Index for Residential Investment. The review is the largest independent survey of the private rented sector taken from 525 letting agents and 259 investment landlords during March.

This quarter's results are again seen as showing that the Buy to Let sector is dominated by the long-term, mature investor.

Publication of the Review is supported by the ARLA Group of Buy to Let Mortgage Lenders, Bank of Ireland, Cheltenham & Gloucester, GMAC-RFC, Mortgage Express, NatWest and Paragon Mortgages. The Group represents well over 50% of the Buy to Let mortgage market.

Across the board, investment landlords report that tenants stay in their properties for an average of 18 months. And 40% said that tenants stay for more than 18 months. A further fifth reported their tenants as staying for more than two years and only a third reported stays of less than a year.

Adrian Turner, chief executive of ARLA, said: "Increasingly, renting is seen as a long-term option across all age groups."

The ARLA Index shows that the annual rates of return for a cash purchase of residential rental property average 11.18%. For geared investments, the average is 21.68%.

These returns include both rental income and capital appreciation.

It is clear that the vast majority of residential landlords are in Buy to Let for the long term.

Nearly two thirds, 65%, claim they expect to hold on to their property investments for more than 10 years. Less than 2% see Buy to Let as a short term speculation in property by holding their investments for under two years.

Mr Turner said: "This augers well for the private rented sector and this is what Buy to Let is all about."

Full details of ARLA surveys are available on www.arla.co.uk
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Publication:The Journal (Newcastle, England)
Date:Apr 14, 2007
Words:341
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