Paragon - Buy-to-Let Remains Steady
The property boom has forced many first time buyers to keep renting and boost the buy to let market, according to the mortgage lender Paragon Mortgages.
John Heron, Managing Director of Paragon Mortgages, comments:
"This month we're seeing a clear stabilisation of yields and rental value as landlords benefit from an easing of property prices as more properties come onto the market."
"It confirms what we've been saying that buy to let as a business remains steady and that there is sustained demand for decent private rented accommodation in all parts of the country. Despite what some people are saying, buy to let is not set for a tumble - there is no bubble and there's nothing to burst."
According to Paragon Mortgages regional buy to let yields are as follows:
- Greater London - 6.84%
- South East - 7.41%
- East Anglia - 7.68%
- South West - 7.98%
- Wales - 8.64%
- North West - 9.75%
- Yorkshire - 10.13%
- North - 10.08%
The price paid for property by landlords fell from £111,997 in January 2003 to £109,669 in April 2003.
The Paragon Mortgages report also suggested terraced house represented the best property type for investment - 9.25% yield, whilst flats were the worst performing property type with yields of 7.48%.