Buy To Let In UK To Continue Boom

The buy to let market in the UK looks set to continue to enjoy prolific success in spite of recent interest rate rises, as a result of persistently high house prices and unsettled market conditions, according to figures released today.

In the figures released by the Royal Institution of Chartered Surveyors, the buy to let property market is continuing to grow at the fastest pace in history, seeing rental demand soar in line with rising house prices as a low-cost, temporary solution.

The currently high UK interest rates have put the price of borrowing beyond many at the lower end of the market, with house prices continuing to grow year on year beyond the reach of those looking to get on the first rung of the property ladder.

As a result, more and more people are turning towards rental property for financial reasons, combined with an upsurge in investment in property, seeing growth in the sector remain strong over the last few years. Furthermore, with the popularisation of the buy to let model in the media, it is proving continually stable in terms of growth from investors.

Additionally with rental income rising at the fastest rate ever recorded, there is no sign of any slowdown in investment in rental property for the foreseeable future as interest rates continue to suppress new home buys and consumer mortgage applications.

However the tightening credit environment derived from the US sub-prime sector looks likely to begin to have an impact on the availability of buy to let mortgages in the UK, which have until now been readily available even to first time investment borrowers.

With banks fearing tying up liquidity against long-term mortgages, analysts are predicting that investors may find they have to work harder to secure initial investment finance against a buy to let investment project.

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