Mortgage Strategy’s Buy-to-let Summit has kicked off this morning with statistics revealing positive prospects for the sector.
Speaking at the Four Seasons Hotel in Fleet, Hampshire, Michael Ball, professor of urban and property economics at Reading University, outlined a raft of figures and reports that give cause for optimism for buy-to-let landlords and lenders.
He says: “The long term prospects for the buy-to-let sector are extremely good. Buy-to-let investors are in a good position. Rental demand tends to do well in a market slowdown.
“There are no signs of this much vaunted meltdown of buy-to-let.”
Ball presented figures that showed buy-to-let lending was still growing in the second half of last year and how demand is increasing.
He says reports from Paragon and the Royal Institution of Chartered Surveyors indicate that rents are rising and that prospective home owners are being put off buying.
Ball outlined statistics, from the Council of Mortgage Lenders, showing that total outstanding buy-to-let mortgages have increased rapidly during the last three years to £1,038,000 in 2007.
He says household rises, migration, immigration and housing supply shortages will help demand in the buy-to-let sector.
Ball also predicts that rising affordability problems may drive people to rent.
Sourcing figures from the National Housing and Planning Advisory Unit, he says that in London, only 52% of people aged between 30 and 34 can currently afford to buy a property in the capital.
Ball adds: “Higher prices will push people into renting and smaller accommodation.”