Let-to-buy market created

Homeowners are reportedly selling up and renting property in a bid to take advantage of the current boom in house prices.

15:09 10 May 2004

Homeowners are reportedly selling up and renting property in a bid to take advantage of the current boom in house prices.

Sellers are moving into rented property in the hope that they can buy back into the housing market when prices fall.

Selling to rent is becoming a popular choice in the south of England and estate agents have dubbed such people the "in-betweeners", according to The Times.

Judienne Wood, director at Bradford & Bingley lettings, said: "Selling to rent is a phenomenon in the more expensive areas of the south of England. If fears of a house-price crash increase, I would expect it to spread to the rest of the country."

A number of financial experts have predicted a crash in house prices in the next few years, as the housing market shows little sign of cooling. Many in-betweeners hope to scoop up a larger home when the market starts to drop back. Most reportedly plan to rent for between six months and a year.

However, experts have warned that homeowners selling to rent are taking a big risk. Hamptons International Mortgages estimates that house prices need to fall between two and five per cent to make it financially worthwhile.

Halifax last week reported annual house-price inflation of 19.1 per cent and the price of an average home now stands at 154,304. Last month, Nationwide building society reported that the average house price rose by more than 100 a day in April, taking annual growth to 18.9 per cent.