Buyers, renters, house prices and finance - ingredients for 'stale-mate' in the property market
The buy to let mortgage market will not recover any time in the near future according to Founding Director for The Landlord Association...
The Landlord Association Director, Dean Woodman-Evans says that "we are realistically looking at 18-24 months before a decent suite of buy to let mortgages will be available. In addition, as is usually the case with these matters, if the buy to let mortgage market enters a recovery mode then so will the residential market".
Mr Woodman-Evans continues to explain the heave-ho effect of the property market. "There are four factors that will play a vital part in the evolution of the property market. Buyers, renter, prices and finance. I believe that prices will struggle over the coming 2 years with more people choosing to rent than buy. Usually this would give a boost to the buy to let industry but a sombre mid-term outlook for UK house prices and lack of real finance options will deter landlords"
Should this balance unfold as suggested, the housing market looks set for a stale period where would-be buyers choose to rent but landlords are reluctant to accomodate for the demand. And as interest rates are as low as they are likely to be this decade, the finanical aspects for most look unsavoury.
"If interest rates rise we could see a disaserous effect in the property industry with millions missing mortgage payments. And this new government are likley to be considering it as a real option. This will push rates with the vast majority of finance houses and banks up and thus make mortgaging, remortgaging or financing in general hard to obtain. Therefore, I see a flat-spotting in the property industry where the 'heave-ho' effect will lay to rest for a while. I think those landlords with property to rent will find it relatively easy to find a tenant for the next couple of years. But any new landlord will struggle to become part of things because finance will effect him/her in the same way as it is for new homeowners".