Buy To Let Investors Ousting First Time Buyers

A growing number of buy-to-let investors are looking to take advantage of current UK property market conditions...

A growing number of buy-to-let investors are looking to take advantage of current UK property market conditions. Research by property investment firm Assetz revealed that buy-to-let investors with large cash deposits have entered the sector.

The firm noted that the trend is having a knock-on effect on the number of first-time buyers, who are finding themselves outmuscled in the market. A big reason for this is the fact that risk-averse lenders are now demanding big deposits, which many new buyers simply cannot afford.

Stuart Law, chief executive of Assetz, said: "Lenders are making no secret of the fact that they would rather allocate the limited funds they do have to the lower risk option of buy-to-let loans, with deposits of 25-40 per cent, than first-time buyers loans with 90 per cent loan to values.

"As a result, the buy-to-let sector is recovering at a remarkable rate, as investors are drawn back by the need for a long-term, low-risk investment for their cash," he said. "The buy-to-let sector has not been as hard hit by the recession as people feared, due to the fact that interest rates have remained extremely low."

- Thursday 28 April 2011

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