Latest figures show that buy-to-let investors are back in action. Estate agents are reporting an increase in landlords buying property in the last three months.
However, investors are not snapping up city-center flats. There is an increased demand from buy-to-let landlords but the demand for flats has seen a sharp drop.
Yet, not all parts of the country have shown a revival. The Midlands have experienced a drop in demand. The demand was strongest in the North West with 29 percent more surveyors reporting a rise than a fall. The buy-to-let market was hit hard by the sharp drop in mortgage availability.
The recent Council of Mortgage Lenders’ figures showed a decline of 4 per cent on the previous three months, with only 21,600 buy-to- let loans being granted in the second quarter. The rise in buy-to-let investment is being attributed to higher proportion of investors making outright cash purchases than taking out mortgages.
Allsop, the UK’s biggest property auctioneer has been encouraging landlords to pick up repossessed buy-to-let stock.
Landlords are being driven to property due to poor returns from other investments. The private investor who has cash to invest is attracted to residential property for the prices are low compared to the peak in 2007. Residential property is being viewed as relatively rewarding by the current market.
