I was not surprised to see a recent announcement by the Association of Residential Lettings Agents that the UK is facing a severe housing shortage caused mainly by the lack of buy-to-let mortgages.
Politicians and regulators were quick to point the finger at the boom in second and third property ownership as a reason for the credit crunch as they jumped on a media bandwagon to nowhere.
Buy-to-let has been, and will continue to be, a sound investment for the right individuals. Like any investment it is a risk and you have to be prepared to lose money.
If you take advice, choose wisely, use a manager who guarantees monthly returns and are prepared to accept that it’s a long-term investment it is as good as stock market equivalents.
So in an industry where one regulator oversees all why have the charges, arrangement fees and interest rates on buy-to-let investments gone through the roof while they have fallen for stock market alternatives?
Our investments only pay initial commission and the value of the investment is not affected by our involvement after completion – isn’t that what the Retail Distribution Review is all about?
Consistency is all we crave, so when will the Financial Services Authority loosen capital adequacy requirements on buy-to-let so the risk to a bank matches that of investment bonds?
If consumers want choice aside from local councils we hold the key. The authorities must realise that it was fat cats and not skinny brokers who caused the crunch.