Confidence in the property market is growing as investors are no longer feeling the pinch of interest rates, a study suggests.
According to Property for Life’s monthly index tracker, 64% of the 8,000 investors questioned said recent cuts in the base rate had helped to lift some of the financial pressures they were under.
Not only is this an increase of 16% on January, but 80% also said they believed now is a good time to invest in the property market.
David Austin, managing director of Property for Life, says: “Having waited several months for some respite, the two drops in the base rate are finally being passed from lenders to investors, demonstrated by the large reduction in those claiming to feel a pinch on their finances.
“The position of buy-to-let investors has been bolstered by those with high capital deposits, allowing them to take low loan to value mortgages and making them a safer bet for lenders than other borrowers.
“The high level of confidence in the market is important and is likely to be long lasting if we see another base rate cut in the next few months.”
The tracker also suggests over two thirds of investors expect house prices to stay the same over the next twelve months, a jump from 17% last month, with fewer people expecting them to decrease.
Austin adds: “The fact that investors believe that house prices will remain more or less stable this year is encouraging.
“Far from being concerned about a slower market, investors are keen to buy while prices remain at their current level.
“Though the housing market is still adjusting, the data from this month’s survey and the CML figures released this week, demonstrate that the buy-to-let sector is thriving and is likely to underpin the property market this year.”
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