When the pandemic hit a year ago it was thought that the buy-to-let market was looking increasingly bleak and that landlords were deterred from entering the sector, or quitting it altogether as a result of tax changes. However, the opposite has been found to be true. Last year saw the smallest sell-off of buy-to-lets since 2013.
The average landlord gross gain increased by 4% to £82,000 when compared to 2019, marking the first annual rise in more than five years.
The average London landlord sold their buy-to-let for £302,200 or 71% more than they originally paid for it, having owned the property for 9.8 years on average. Landlords in London made the biggest gains whilst those in the North East made the smallest gains. The average landlord who sold in the North East made 16% capital gain on a property owned for 8 years.
Despite the increase, typically landlords who sold in the capital last year made a smaller gross profit than those who sold in 2016 when they made an average gain of £364,960. The year 2016 marked the high point for landlord profit when many investors, having bought at the bottom of the market following the 2008 financial crash, decided to sell up. The top 10 local authorities where landlords made the biggest gains were all in London.