The buy to let sector is booming, according to new figures from Paragon Mortgages.
Rising prices seem not to be putting investors off from adding to their property portfolios, Paragon’s May Buy to Let Index shows.
Nationwide, sale prices have increased by 1.99 per cent since last month, generating a 4.7 per cent increase over the last six months.
Paragon managing director John Heron explained: “Residential property investors continue to build their portfolios in a buoyant housing market. We’ve seen prices at which they buy properties rise by almost 2 per cent since last month, contributing to a 4.7 per cent increase in the 6 months since October 2005.
“This pick-up is led in particular by strong property price inflation in the North, Greater London and the South East.”
He suggested that new entrants to the buy to let sector are not behind the current upward trend.
“There has been a resurgence of buy to let activity since last autumn, particularly among larger scale and professional investors. In all parts of the country, upbeat landlords are buying properties at higher prices, secure in the knowledge that there is good tenant demand out there for the right property in the right place”, Mr Heron stated, adding: “It is perhaps no coincidence that real estate investment is popular at a time of uncertainty in the equity markets.”
Paragon’s findings are consistent with recent studies from the Royal Institution of Chartered Suveyors and the Council of Mortgage Lenders, suggesting that 2006 is turning out to be a boom year for the buy to let sector. To read more about property, click here.
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