The buy-to-let sector was flagged up as a potentially lucrative area at a House of Commons discussion this week. The forum, entitled ‘First-time buyers: Understanding new trends’, conducted by IPSOS UK with research commissioned by GMAC-RFC, reported that people were increasingly choosing to rent instead of buying.
Stephen Knight, executive chairman of GMAC-RFC, said: “From a lender’s perspective the decline in first-time buyers is not wholly negative as our research indicates more people are renting, therefore buy-to-let business volumes are strong. We advise brokers to capitalise or look to buy-to-let if they aren’t already operating in the sector.”
The Liberal Democrat shadow chancellor Dr Vince Cable pointed out consumers’ lack of saving in terms of pensions. He said: “People seem to be looking in the direction of property as a retirement fund and the obvious choice seems to be buy-to-let properties but it’s a dangerous game to rely on market conditions.”
Paul Hearnden, managing director of My Mortgage Direct, said: “I expect the buy-to-let market to make a surge towards the end of the year as a result of SIPPs.
“This will continue to bolster the market but we, as the adviser, must be extra careful when dealing with such cases and ensure that rules are understood and that it is the right asset to be used as a pension fund.”
