November 19, 2021

Could your home now be the main breadwinner?

The news this autumn has been awash with articles outlining the ever-growing cost of living across the UK. With the supply of basic items such as chicken, pasta and crisps all falling way below demand, this trend is likely to continue long into 2022. Fuel prices have also featured heavily with at the pump prices setting new records having been exacerbated through mooted rumours regarding supply shortages.

It isn’t just consumers that are feeling the squeeze, with some of the UK’s largest energy suppliers biting the dust through unattainable natural gas prices. A sector which bases much of its model on fixed customer pricing is now left with no choice but to fold, and with the government still short on cash through 18-months of covid a financial rescue for most is unlikely.

Despite some fearing the worst, it would seem that regardless of how restrictive our disposable cash may become, consumers in most sectors continue to show little sign of tightening the shoestrings.Electronics, cars and fashion retailers have seen record spending over the last6-months, with delayed supply chains not impacting consumer impulses.

The property sector too has seen incredible demand with prices growing by over 15per cent in some parts of the UK. Building materials too have seen a stark price increase, giving even better capital appreciation to most homeowners looking to develop their property.

All of which elicits an interesting question, in the current climate, just how much does my home earn per annum?

At this moment, the UK average salary sits at around £31,000before tax and national insurance deductions. The average price for a house in the UK is around £264,000, which when combined with the last twelve months of price growth represents an increase of around £34,320.

So in conclusion, if you earn the UK average salary you are now second in terms of earning power behind your own home.

What we should take from this is the UK property market has continued to deliver a reliable investment case. With rental demand and supply far from reaching amalgamation, we expect to see this growth continue far into 2023.

For help and advice on how you can get into the buy-to-let market please speak to a member of our team on +44 (0)161 768 5199 or email us at enquiries@elavace.com.

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