Buy-to-let boom ‘is over’

The chair of a development and investment company has stated that he believes the buy-to-let market is in peril, according to the Scotsman.

Those seeking to invest in the buy-to-let market may be interested in Andreas Panayiotou’s comment: "I think everything is overvalued by 20 per cent. Things have been getting way out of control. Prices need to drop to bring returns above the cost of funds."

Mr Panayiotou added that people are involving themselves in the property market "because people say that residential is great" but he warned that many would-be investors lack experience in the sector.

Nigel Terrington of the UK’s largest buy-to-let lender disputed the claim that yields had fallen to around 3.5 per cent, telling the newspaper that across the UK yields have been around six per cent.

He added that while they are lower in expensive areas such as Edinburgh, landlords in university towns typically get a one per cent superior yield from student lets than other rentals.

The Ability Group is one of the UK’s biggest residential landlords.