The buy-to-let market is inaccessible to the average investor and is now only an option for the wealthy, according to the Royal Institute of Chartered Surveyors (RICS).
The Institute blames high interest rates, rapid house price inflation and high levels of rental cover for making this type of investment unavailable to most of the population. RICS says the average UK property would require a deposit of £65,600 in 2007, assuming an average buy-to-let mortgage requires a 30% deposit. This compares with just £10,100 in Q1 2002, when most buy-to-let mortgages required an average 8% deposit, according to RICS. Most buy-to-let mortgages also require high rental coverage of 125%, meaning rental income must be 25% higher than monthly mortgage payments. This has...
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