We are selling our investment properties as mortgages get more expensive and rental yields decrease.
Recent Royal Institution of Chartered Surveyors (Rics) figures show tenant demand has declined and the number of buy to let properties getting onto the market has gone up.
House buyers are coming back to the market to avoid increasing borrowing costs, signalling a decrease in demand for rental property.
Given the greater supply on the market because of a rush to avoid upfront costs of home information packs, buyers have found the market not as tight as they had anticipated.
Recent figures highlight that there has been a 12% decrease in estate agents reporting an increase in lettings compared with October.
Landlords selling investment properties went up to 5.2%, the highest level in the last two years.
Gross yields on investment property decreased for the third quarter in a row, the fastest decline since July 2004.
As tenant demand has fallen, increasing mortgages signifiy buy to let property investors increasing to compensate for spiralling costs, with 29% more surveyors reporting an increase as opposed to a decrease in rents, just 1% below the record figure.
Interest rates are to rise later in 2007. Yet the strength of the economy as well as an active housing market ought to enable a soft landing for many homebuyers.
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Spiralling Costs Mean Property Investors are Selling Up Mon, 11 Jun 2007
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