Is Buy to Let in the UK Entering A Golden Age?

Over the past 10 years, the UK property market has been booming but with the recent credit crunch and interest rate rises and the consequent cooling of the property market, many people believe that the property boom is over and property investment in the UK is no longer going to be a profitable venture like it has been in the past decade… or are we about to enter another golden age?

Recent statistics published by the Office of for National Statistics have said that within ten years the UK’s population will have risen to 65 million people and by 2031 this figure will have grown to 70 million.

This huge increase in the population will only fuel the UK’s housing crisis with many first time buyers unable to get onto the property ladder. However, one person’s loss is another person’s gain and with the population of the UK set to explode in the next two decades this could mean that property investment and buy to let in the UK could be entering another golden period.

The UK’s property market is driven by supply and demand and with an expected sharp rise in the population and no sign of a solution to increase house building in the UK this severe lack of housing supply and increasing demand will fuel property prices even further in the next 10 or 20 years.

If the above statistics are correct then the UK could be heading for a chronic housing shortage. But as mentioned above this could be excellent news for property investors and Landlords because if this extra demand from the expected growth in the population happens, investors and landlords with a good medium term investment plan will not only see good returns on their property investments but will also see increasing demand from tenants in the form of first time buyers and immigrants from Eastern Europe.

Another interesting point to consider is that interest rates are likely to fall by 0.5% in 2008 which will only help the property market and will also make borrowing cheaper for investors, thus making property deals and investments more appealing.

So with the UK population set to increase over the next 25 years and interest rates set to fall in 2008, property investors and landlords could well be entering another golden era in Buy to Let in the UK.