Is this bye-bye buy-to-let?
The buy-to-let market has boomed over the past few years as investors have piled into property. They sat on ever-increasing capital gains as house prices rose and ignored the risks and the downsides. For a while, they looked like the only winners.
But things are different now as property investors battle with falling house prices and unlettable property. So will the buy-to-let boom turn to bust?
For landlords looking to remortgage, banks and building societies are pulling the plug on buy-to-let loans, which are traditionally seen as riskier than standard residential mortgages. Despite the fall in house prices, it's harder to get the finance as lenders insist on bigger deposits. Lenders also demand 30% buffers when just a year ago, you could arrange finance without any buffer at all. The rates have gone up too – and if the rates go up, the profits go down.
It's a gloomy picture, but will it get any brighter?’
