The mortgage market that encompasses buy-to-let mortgages is heading for a downturn experts at Standard Life.
The confidence of investors has been hit by higher interest rates than were anticipated and therefore they are now less likely to put their money into the property market.
An expert from Standard Life stated that rate rises since the summer of 2006 have led more potential investors to question if property is the correct area in which to invest their money.
The Standard Life survey suggests that investment in either one’s own home, or buy-to-let properties, has reduced from the levels enjoyed at the start of 2006.
Some experts from the main lenders such as Northern Rock, Abbey and Mortgage Express state that the rising cost of borrowing with a mortgage means that new buy-to-let investors may find the income from their properties does not cover their mortgage repayments.
However the Mortgage Lenders Council, show that 330,000 additional buy-to-let mortgages were taken out in 2006 – the highest for a decade.
