If your thinking about investing in a buy-to-let property to help fund your retirement, then you may be pleasantly surprised to know that rents have gone up for the first time in three months. According to the latest estimates by LSL Property Services, the national average rent rose by 0.1% to around £649 a month. In addition, yields in June rose to a five year high to hit 5.1%. This is good news for many landlords who over the last year were hit badly by falling rental yields due to the credit crunch.

Interestingly, two of the largest pension funds are looking to invest in the buy-to-let market. Aviva Investors and Legal and General have both confirmed that they are currently talking to the government to explore opportunities to create a professional rental sector. They are looking at potential sites where they can build-to-let, having benefits for both investors, as well individuals looking for affordable housing. If this goes ahead it will be the first time in over 50 years that there will be institutionally owned rental property. This will certainly act as a boost to the sector.

However, there are still risks attached to the buy-to-let sector. For example, there is still a high volume of individuals that are in rental arrears. According to LSL, 529,000 people in June were in arrears, totalling around £254 million of debt. Therefore, it is important to consider all options before investing into this type of investment.