The buy-to-let market will stay steady this year, according to the Great Housing Market Debate panel.
BBC economics editor Evan Davis said although BTL investors will see a negative return on capital, rental incomes will be sustained.
He said: “A lot of these investors feel excited about the market when it is going up so I do not think anyone will look to buy a place as an investment this year.”
Davis also pointed out demographic change has underpinned BTL investment over the last few years. He said: “It has been Polish migrants coming in. That might be part of this great economic turning point. We do not know how significant that will be. The zloty has appreciated very considerably against the pound, the incentive for arriving here has now diminished and the economic incentive for going home has begun to emerge.”
Morgan Stanley chief economist David Miles said: “Even though rents are rising and yields will no doubt rise quite sharply too, if house prices are edging down lower, then I find that will be a difficult environment to expect net new dem- and for buy to let to increase very sharply.”
“But because transaction costs of getting out of this market if you already have a property are high, my guess is that the stock of existing investment is pretty sticky.”