BUY-TO-LET_Investors selling up as rate rises hit home

Four Bank of England base rate rises in nine months, combined with falling rental returns, have prompted a rise in the number of investors selling buy-to-let properties, it emerged last week.

Figures from the Royal Institution of Chartered Surveyors (Rics) revealed that between January and March this year the percentage of landlords offloading properties had jumped by more than a percentage point to 5.2 per cent - its highest level in two years.

"Rising borrowing costs and a subsequent drop in yields have contributed to a worrying time for landlords," said Jeremy Leaf, the Rics spokesman.

But a robust economy and housing market should, he added, ensure "a soft landing for many".

Industry estimates suggest that buy-to-let represents about 11% of private rented housing, up from 5% in 2000.

The buy-to-let market nudged [pound]94.8bn in 2006, up by 29 per cent on 2005.

Volumes of buy-to-let mortgages ballooned last year: 2006 saw a near 50% rise in numbers of new loans to 330,300. There are 850,000 buy-to-let mortgages outstanding; in 1999, it was 73,000.

Britain now has some 2.9 million privately rented properties, representing 11% of the UK's housing stock.

Further browsing Track rises in interest rates and their impact on your home at ww.bankofengland.co.uk

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