Monday, Nov 17, 2008
In it for the long term!
BBC News: Problems looming for buy-to-let
Between 20% and 40% of buy-to-let (BTL)landlords will fall into negative equity if house prices keep on falling at their current rate, a report says.
The credit ratings agency Standard & Poor's says that by June this year BTL mortgages had a repossession rate greater than ordinary home loans.
It warned that financial problems were concentrated among BTL mortgages granted in the past two years.
The report was based on studying 200,000 BTL loans, 20% of the total.
"We believe that the BTL sector could suffer above-average loss severities on repossession cases due to a concentration of certain property types that are witnessing above-average price declines," said Kate Livesey, an analyst at S&P.
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