5 Dec

Buy to let sector 'will stay strong in 2008'

Buy to let sector 'will stay strong in 2008'

The demand for buy to let mortgages will remain strong next year despite market stagnation during the first half of the year, it has been predicted.

According to Property for Life, house prices will be static during the first half of 2008, prompting novice buy to let investors to hesitate to commit to purchases.

David Austin, managing director of Property for Life, said: "Property prices will be static for the first half of the year, with overall price growth for 2008 reaching a potential maximum of three per cent.

"As a result of this and the lingering aftermath of the credit crunch, we expect to see some slight dips in activity levels and demand as newer investors hold back until they are more certain about the state of the housing market."

However, experienced investors will remain active throughout the year and the market will return to robust health shortly after, prompting these investors to return to the buy to let sector, Mr Austin predicts.

Moreover, with three 0.25 per cent cuts to the base rate of interest in prospect, the buoyancy in the buy to let market seen in 2007, is set to continue, he added.

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