Insurance News Archive

Rics: Landlords to suffer in 2008

Landlords in the UK could face financial difficulties in the new year after escalating costs over the past three months begin to hit home.

Figures from the Royal Institution of Chartered Surveyors (Rics) have revealed that landlords are having to pay more than ever, with arrangement fees shooting up as high as five per cent of the loan amount in some cases.

And, despite a 0.25 per cent cut in the Bank of England base rate, landlords are still facing punitive interest rates of seven per cent and more.

Jeremy Leaf, spokesman for the Rics, said: "The situation is a mess and it is inevitably going to have an effect on the housing market and the wider economy.

"It is a shame because it comes at a time when there is strong demand for rented property. Landlords should be getting more choice from the financial markets."

He complained that many mortgage lenders are not passing on the base rate cut made in late 2007 as they are "clearly trying to retain margins".

24 Dec 2007