Buy-to-let 'must be thought through'
Property experts have claimed that with many people looking to rent property, buy-to-let mortgages could still be very worthwhile, but only so long as people considered prices very carefully.
The Building Societies Association (BSA) said that all maintenance costs should be taken account of when weighing up the value of a potential buy-to-let property, with takers needing to be sure that returns will be large enough to offset high costs.
A recent report from the Royal Institution of Chartered Surveyors indicated that, with a deposit of £65,000 typically needed, getting on the buy-to-let ladder was out of many people's grasp.
Neil Johnson, PR and policy manager at the BSA, said: "The main thing to do is to get an independent idea of what the property is worth and what kind of rental value you would get. Then you do the sums and make sure it makes financial sense.
"There is still a very high demand for this sort of thing from tenants and as house prices get higher, more and more people will be priced out and that demand will increase even further. Buyers just need to make sure that they are not paying above the odds."
Renting property is the only possibility for many people setting up in expensive areas like London – which makes buy-to-let investment potentially lucrative in the capital.
Published 13th December, 2007
© 2007 Estates IT Limited
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Property experts have claimed that with many people looking to rent property, buy-to-let mortgages could still be very worthwhile, but only so long as people considered prices very carefully.