Landlord’s Gain but Buyers Lose Out

Posted 2007-12-18

Today, the Royal Institution of Chartered Surveyors (Rics), revealed that though the slowing housing market increased rental growth, the demand for flats has reduced. This is because there is a lack of incentives for would-be-buyers to take the initiative to buy property.

According to the Rics, its quarterly survey revealed that there is more demand for family houses and the excess supply of flats in the market. The demand for family houses has increased by 25.2 percent and the demand for flats has decreased from 36.9 percent to 16.9 percent in the last quarter.

The survey though, has given a warning of uncertain economy to landlords. It states that the tightening lending criteria and successive rises in interest rates had begun to hit the buy-to-let market.

According to Jeremy Leaf, a spokesman for Rics, the rise in home rent coupled will make it difficult for would-be-buyers to raise the capital for that first important purchase. Landlords can for now, take solace from uncertainty in the economy and enjoy the gains from rising rents.

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