Buy-to-let market affected by credit crunch

Posted: 06 May 2008 13:23:34 GMT


            Property News - Buy-to-let market affected by credit crunch

A rise in the demand for rented accommodation has not been accompanied by an increase in the number of buy-to-let mortgage products on the market, it has been revealed.

A rise in the demand for rented accommodation has not been accompanied by an increase in the number of buy-to-let mortgage products on the market, it has been revealed.

Research conducted by moneysupermarket.com shows that five per cent more people are renting properties now than they were last October, with many homeowners being forced off the housing ladder as a result of lenders' tightening credit criteria.

However, this surge in demand for rented accommodation has not prompted lenders to offer more buy-to-let products. Rather, fewer are now on the market as a result of the credit crunch.

"Our research shows the number of buy-to-let products has decreased from 4,025 to 674 in just one year, with nearly 600 of these products removed since March 31st," confirmed Louise Cuming, head of mortgages at moneysupermarket.com.

"As stringent lending pushes people into the buy-to-let market, the decrease in the number of buy to let mortgages becomes increasingly alarming. I fear we will soon see many people unable to buy or rent - the question is, where do they go from there?"

In the last month alone, the number of buy-to-let deals available has fallen by 40 per cent.


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