Buy-to-let future not as 'gloomy' as some predict
Published: 31-Jan-2008
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The future of the buy-to-let market is not as "gloomy" as some analysts have suggested.
That is according to Nationwide, which reported today (Thursday, January 31st) that house prices have edged down by 0.1 per cent over the past month.
Martin Gahbauer, senior economist at Nationwide, said that the main concern regarding buy-to-let was that in many cases the cost of finance was now greater than the rental yield on property.
Mr Gahbauer said that, because of predictions of a "more subdued" housing market this year, many were worried that lower house price expectations could make people less willing to invest in low-rental yield property.
"While such concerns are certainly relevant, they are much more of a factor for those with a short investment horizon rather than for those in it for the long-term.
"A property investor planning to hold the investment over a long period will benefit from future rental growth and is in a better position to ride out temporary periods of weak capital gains."
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