Don't follow the herd: buy-to-let investors urged to look where others fear to tread

While many buy-to-let investors are holding back amid higher borrowing costs and growing regulation, property entrepreneur Mike Robson is actively looking for opportunities to expand his portfolio.

And his advice to other investors is to resist following the herd and look more closely at locations where buyers have retreated.

Speaking on the opening episode of the relaunched Investors Corner podcast, the Avocado Property co-founder said: "It's not a bad time to buy an investment if you've got some money. Have a look around."

Robson, who continues to invest in property following Avocado's acquisition by iad UK, said substantial differences between regional housing markets were creating opportunities for investors prepared to research unfamiliar locations.

He contrasted the relatively healthy market in his area of the Home Counties, where more than half of properties were sold subject to contract relative to available stock, with coastal locations where agents reported figures as low as 14% to 30%.

Robson described his own recent experience of negotiating the purchase of a flat in Devon.

The property was being marketed at approximately £130,000 less than its previous owner had paid in 2021, and Robson subsequently negotiated a further 9% reduction from the asking price.

He acknowledged that the purchase also had a personal lifestyle attraction but said it illustrated the negotiating opportunities available in markets where buyer demand had weakened.

"I don't know where the bottom is. Anybody that says they do is lying," he said.

Robson, a previous co-host of Investors Corner, suggested that some coastal property markets were experiencing the consequences of the buying boom in 2021, with owners now facing the expiry of five-year fixed-rate mortgages agreed when interest rates were considerably lower.

He also identified potential opportunities in parts of the North East, where property prices remained relatively affordable and investment in towns and local services could influence longer-term prospects.

However, he cautioned against assuming that the cheapest property represented the best investment, particularly when buying hundreds of miles from home.

Investors needed to consider the condition of a property, its location and the practicalities of managing it, rather than simply pursuing the highest apparent yield.

Robson argued that the traditional approach to buy-to-let had become less attractive because of higher borrowing costs and changes to mortgage interest tax relief. Investors now needed to think more carefully about their objectives, ownership structures and long-term financial plans.

Recalling the period when buying a rental property was almost fashionable, he said many people had invested simply because everyone else was doing it.

His advice to today's investors was straightforward: "Know why you're doing it."

The interview marked the relaunch of The Investors Corner, now hosted by iad UK Lettings Manager, James Rawlinson and Managing Director, Lee O'Brien.

The podcast explores property investment, business and wealth creation, with further episodes featuring experienced investors and industry specialists.