Buy-to-let market lacks new blood

The number of buy-to-let investors joining the market has dropped by nearly 50 per cent since last year, the Telegraph reports.

12:31 12 August 2005

The number of buy-to-let investors joining the market has dropped by nearly 50 per cent since last year, the Telegraph reports.

Blaming a progressive slowdown in the housing market for scaring away would-be landlords, the Mortgage Trust has released figures showing that only 12 per cent of buy-to-let investors are new participants in the market. Comparatively, at this stage in 2004, 23 per cent of investors in the market were rookies.

Moreover, the Bank of England's latest action over interest rates will do little to encourage greater participation in the market, Mortgage Trust has speculated.

Nicola Severn from Mortgage Trust commented that a survey of mortgage brokers had revealed a profound pessimism, with over 50 per cent stating that they were not confident that their buy-to-let business will pick up in the next few months.

Mrs Severn said: "The speculators that flooded the market a couple of years ago have disappeared. Although falling interest rates clearly bode well for the market. . . some brokers believe that the high prices are still causing problems for new entrants."