Submitted on Friday 17th April 2009
Buy to Let update
Current market conditions
- Banks and government do not appear to be supporting the sector when it comes to making debt available
- Buy to Let properties account for about 12% of the mortgage market
- Reluctance of first time buyers should increase national tenant demand or create more stay at home kids/crowded houses
- Tenant arrears rising
- Mortgages currently restricted to 75% except in certain situations
- Low interest rates helping many landlords to make a profit at the moment
- Probably sensible to fix before lack of mortgages and inflation make things perilous
- Tenants Deposit Scheme now in place means deposits are held by Government appointed companies to avoid lanlord tenant disputes
- New build schemes struggling as lenders avoid owing to over capacity and price manipulation
- Many lenders are not too keen to help developers who are using B2L as a substitue for selling
- CML restrictions mean it is much harder for people to buy without a deposit.The CML tightened up rules over fears of market abuse particularly in the new build market
- Less active lenders in the market means less choice and competition
- Low introductory rates are normally accompanied by high fees
- London rental prices down owing to 20% drop in overseas tenants
