Friday, 18 December 2015

Ministers Urged To Examine New Buy-To-Let Boom In UK Care Homes

Private investors are being enticed to purchase rooms in UK care homes on a buy-to-let basis with the promise of large profits and rental income. The Bureau of Investigative Journalism has found hundreds of rooms being offered for sale for as much as £85,000 each. They offer “guaranteed” rental income of around 10% annually and a total return on investment of up to 188% over 10 years. Such buy-to-let room schemes are not regulated by the Financial Conduct Authority, while the Care Quality Commission, which oversees standards in care homes, says it does not have responsibility for providers’ financial sustainability. Servicing such high fixed returns could squeeze funds available for providing the actual care. Residents could also have to move if the care homes failed to pay their debts to investors and were forced to close. Read more on the BIJ website.

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