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Strategies & Market Trends : The Residential Real Estate Crash Index -- Ignore unavailable to you. Want to Upgrade?

To: Les H who wrote (915)	10/18/2001 6:44:03 PM
From: Les H	Respond to of 306849

Lower interest rates fuel buy-to-let boom Low interest rates and volatile equity markets have boosted the buy-to-let market as investors look for a safe haven for their cash, a letting group has claimed. The Association of Residential Letting Agents said since the buy-to-let market was formally launched five years ago there has been a steady growth in people investing in property. A spokesman for the group said people who were traditionally conservative with their savings saw it as a safer investment than the stock market, but one which produced higher yields than a deposit account while interest rates were at their lowest level for 37 years. During the seven months to the end of September ARLA said a total of £1.27 billion was lent on 14,917 properties by the five lenders on its buy-to-let panel, who write around 40% of all mortgages for investment properties. The amount lent by the panel has risen from about £16.3 million a month in 1997, to a monthly average of £181.4 million this year, bringing the total value of mortgages on investment properties to £4 billion. The average size of the mortgage is £81,300 up from £67,000 in 1999, but down on last December's average of £102,000. Unsurprisingly the highest concentration of buy-to-let properties in terms of value are in London, where the average loan is £170,000, followed by the South East. The lowest concentration is in Scotland and Northern Ireland, where people borrow an average of £32,000 to buy a property to rent out. Chairman of ARLA John Crossley said: "The fifth birthday of buy-to-let shows a remarkably steady pattern of substantial growth in terms of the number and the values of individual loans." He added that the group is predicting the market will continue to grow in the near future, boosted by a steady increase in demand for rented accommodation.