August 29, 2008

Can buy to let survive?

The simple answer is now, no. That is according to the CEO of Firstrung, Paul Holmes, he believes that buying a property to simply let it out, is now unsustainable and therefore people should only buy a property from now on only if they intend to live in it.

The whole business of buy to let is changing, in order to get a mortgage for this purpose the buyer will now need to scrape together a massive twenty five per cent deposit, and this is something that not many buyers will be able to do, as it will be around £50,000.

Once this type of investment has gone away, it is doubtful if it will ever make a return. It has been too easy for just about anyone to get a mortgage and then find someone else to pay rent on the property in order to cover the costs.

Source [Wow Property]