Privately rented property in the UK due to shrink in the UK
Over the next few years the amount of privately rented homes in the UK is likely to shrink by around sixty-six per-cent according to Scandia. More and more investors are deciding not to go into the buy-to-let market with the housing market being so uncertain at present.
Chief executive Nick Poyntz-Wright of Scandia UK said, "Higher mortgage rates and falling property prices will cause investors to reconsider their exposure to residential property and many will choose a more diversified approach."
Higher debt costs, falling house prices and the general state of the UK economy are all contributors to this.
The stock of UK buy-to-let mortgages fell from £120 billion by the end of 2007 to £44 billion, and Skandia said that £18 billion worth of equity was likely to be released from UK housing.
The group said that the market was likely to shrink dramatically after the huge growth that has been seen over the recent years, though the group did not give a specific timescale as to when this might happen.
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