View more on these topics

Buy-to-let is a rich man’s game, says RICS

The buy-to-let market is now so inaccessible to the average investor that only the wealthy can afford to be become landlords, according to RICS.

RICS says the barriers to entering the buy-to-let market, driven by interest rates and levels of rental cover ratios for mortgages, have made investment “an unattractive proposition for vast swathes of the population”.

Today would-be-investors need to lay down a deposit of £65,600, or 30 per cent of a property’s value, for the average UK house in order to get a foothold on the buy-to-let ladder, according to RICS research. This compares with the £10,100, or eight per cent of a property’s value, required in Q1 2002.

RICS senior economist David Stubbs says: “It takes more capital than ever to set up a buy-to-let investment. Would-be investors who have missed out on the impressive returns of previous years are now finding the hurdles to property investment are higher than they imagined.

“However, existing landlords should be able to use the equity in their past investment properties to fund the deposit needed for new ones, and this should ensure that demand from the buy-to-let sector does not dry up entirely.”

Recommended

Pink Home Loans COO to leave

Pink’s chief operating officer Elliott Stonehan has decided to leave the company to pursue his passion for oriental languages.Pink has decided to promote former head of marketing Neil Hoare to the position of associate director proposition development.In his new role, Hoare will assume responsibility for all products, services and propositions at Pink, along with IT […]

Axa eases GP report requirements

Axa has abolished automatic GP report limits for people under 45 applying for life or critical-illness products. Automatic GPR limits for income protection applications by under-45s will increase to £50,000.

Newsletter

News and expert analysis straight to your inbox

Sign up

Comments

    Leave a comment