Landlords set to benefit from global credit crunch

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by Kay Murchie

The worldwide credit squeeze has had an impact on many people in a harmful way but buy-to-let property investors are actually benefiting from the credit crunch.

Moneygate, the financial services organisation, said there is a growing amount of people seeking rented accommodation after mortgage lenders are becoming much stricter on who they will lend to.

The firm added that an increase will be noted in potential buyers having their mortgage applications denied and landlords will reap the benefits by renting their properties to these people.

Dennis Reed of Moneygate commented that in general the rate of arrears and repossessions for buy-to-let investors is much lower than for residential on account of the income they can produce.

Furthermore, experienced portfolio landlords tend to be older and have greater income as well as an asset-base, which the average residential buyer does not.

Mr Reed continued that the buy-to-let sector looks set to benefit further with predictions of up to 15% growth over the next 12 months.

It has recently been announced that UK landlords are already charging extortionate rents following the growing demand for rented accommodation according to The Association of Residential Lettings Agents.