For many contractor workers the idea of establishing permanent roots via the mortgage route is not a comfortable thought.
The uncertainty of the job market and the short term nature of contractor employment see many who are in this position trying to distance themselves from heavy financial burdens such as mortgages.
Buying to let however, still has merit especially with the demand for rental property on the increase, and house prices steadily decreasing.
If you are a contractor thinking about an investment in a buy to let property it is worth considering that any investment should be seen in the long term. British banks are never out of the news and in the main this is not for the best of reasons.
Lending is still timid and deals are less favourable with low capital, but it is slowly beginning to turn around.
Figures from Trinity Financial show that experienced landlords are buying property in the most expensive areas as they are almost certain property prices will rise, and will see very good returns on their investment.
Contractors can benefit in a similar fashion, as a ten year investment in property, providing it is occupied for 95% of the time, see profit from the rent and profit when the property is sold.
One of the secrets to buying to let is to be cautious. Many contractors who buy to let who are doing so for the first time tend to buy as cheaply as possible in poor areas. It is always possible that prices could fall further than the current price, and many seasoned landlords wait three years before purchasing in poorer areas. Impulse purchasing often leads to the erosion of capital which makes re-mortgaging impossible.
It is pitfalls like these that contractors need to be weary of before entering into the buy to let market.
Nonetheless, buy to let for contractors does represent a good second income stream and possibly a paid for property providing the contractor can keep it occupied most of the time, and is willing to keep letting out the property for the duration of the mortgage.
Since 2009 buy to let mortgages have slowly made gains with this year seeing a 32% increase in mortgages for landlords. The property portfolios for landlords increased to 14.1 properties per landlord from 12.9 this year, which underlines their faith in the market.
If you are a contractor which has the money to invest in a buy to let, now is the time.