The buy-to-let boom has pushed up mortgage payments for many borrowers by 90 a month, according to a study by the National Housing and Planning Advice Unit.
The unit, which advises the Government on housing affordability, believes that the massive rise in BTL over recent years has had only a moderate impact on house prices and accounts for 7 per cent of the inc-rease in property values.
It claims that if the BTL boom had not taken place, the average house price in the second quarter of 2007 would have been 169,000 rather than 183,000 and borrowers with 100 per cent mortgages would be paying 90 a month less. The NHPAU says the rising number of households, constrained supply and interest rates have made more of an impact on house price inflation than buy to let.
Assetz chief executive Stuart Law says the figures back the firm’s long-term view that BTL investment has not significantly affected house prices to the detriment of first-time buyers. He says: “The economic contribution of the private rented sector to the economy is well documented and, with three million households housed by private landlords, it is clear that a much needed service is being provided by investors putting money into the sector.”
BM Solutions managing director Tim Hague says: “Buy-to-let investors have had a positive impact on the housing market. It plays a vital role in meeting housing demand and, in some areas across the country, renting has helped to regenerate the market. However, buy to let is only one factor in increasing house prices. We should remember that people are making the choice to rent, with many valuing the flexibility that this can provide.”