Buy-to-let 'filling housing gap'

Buy-to-let properties are continuing to perform the function of providing affordable accommodation for many Britons, it has been claimed.

Nigel Terrington, chief executive of the Paragon property group, was commenting after its figures showed that the buy-to-let market is continuing to experience steady growth.

Rental yields have remained stable at six per cent throughout the year, Paragon claims, while annual rent levels were also found to have increased by 13 per cent in the first two quarters of 2007, reaching £10,938 in June.

According to Mr Terrington, the private rented sector is catering for a high demand for accommodation among Britons, particularly as a result of the "dwindling supply of social housing".

A high-interest rate environment, with the Bank of England having implemented five quarter point rate rises since August 2006, is also precluding consumers from getting onto the property ladder, with the buy-to-let market consequently helping to fill the housing gap.

The buy-to-let market "remains robust" and is set for future growth, Mr Terrington speculated.

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