Saturday, Jan 26, 2008
Higher mortgages and rising rents
FT: Rising mortgage costs boost lettings sector
There's some odd data in this FT article - allegedly 21 percent total return on BTL property in 2007 which is supposedly 3 times the return in 2006. However, supposedly rents rose by 19% over the year, and 8% in Q4 - all according to Paragon who now can't convince anyone to give them more money to lend to landlords. Perhaps only they can make it up...
The main thrust of the article is that since renting is cheaper than a mortgage by one third there is more demand for renting - lots of STR??
Also the government seems determined to ensure that citizens buy property rather than rent it. The logic for this is unclear - it would make more sense to sell property to foreigners en masse before prices crash further so they suffer the losses. Two houses on Bishops Avenue is a start...
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