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Housing Bubble Fear Over Buy-To-Let

Tuesday, 29th September, 2015

Britain's buy-to-let landlords owe more than 200 billion on mortgages - equivalent to the size of Hong Kong's economy.

The figures revealed yesterday about the scale of the debt fuelled concerns that the buy-to-let market could be badly hit by expected interest rate rises and the impact of Government interference. 

The Council of Mortgage Lenders (CML) published the figure as it claimed a combination of proposed tax and rule changes could create "uncertainty" in the market and urged ministers to consider the risks. Brokers said the boom in buy-to-let mortgages had caused "mirco bubbles" in the housing market as landlords swarmed on the profitable areas, pushing up prices. The CML data showed the amount outstanding on Britain's buy-to-let mortgages has grown by 44 billion in the past five years.

The CML attributed the rise to increasing demand for rented homes. Experts also believe rock-bottom rates for savers and new pension freedoms, which allow people to take their own pension pot as a lump sum, mean more older people - so-called "granlords" - have invested in property. 


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