Buy-to-let mortgages safe as houses

Commercial investors in buy-to-let property in Britain and Northern Ireland should not be affected by a drop in tenant numbers, despite the housing market continuing to cool, experts have said.

According to the Association of Residential Lettings Agents (Arla), the buy-to-let market has always remained strong and should continue to do so, as interest rate rises mean more people are put off taking out their own mortgage and would prefer to rent.

Malcolm Harrison, spokesperson for Arla said the recent rate rise would not affect too many landlords. "A very high proportion of buy-to-let investors have taken out fixed mortgages," he explained. "A crucial factor in buy-to-let is that people work out what they’re going to earn and what it's going to cost."

"Buy-to-let is quite predictable, in that if there is a slow-down in house prices you know there is going to be more rental demand, and that always means the case of a thriving rental sector," he added.

It seems that landlords are not as affected by mortgage worries as the Council of Mortgage Lenders' data shows that only 0.63 per cent of buy-to-let mortgages were in arrears, compared to the average of 1.06 per cent across the mortgage market.

Indeed solicitors should still see plenty of demand for commercial property services, since the sector is growing. Ten per cent of mortgages are buy-to-let investments, compared to three per cent five years ago.

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