Released on = July 27, 2007, 5:26 am

Press Release Author = Jimwatson

Industry = Real Estate

Press Release Summary = Claims that the buy-to-let market has somehow negatively
affected house prices by taking homes away from would be first-time buyers and
increasing the scarcity of available properties have been frequent in recent times.
But Paragon Homes chief executive Nigel Terrington has hit back at such claims.

Press Release Body = Claims that the buy-to-let market has somehow negatively
affected house prices by taking homes away from would be first-time buyers and
increasing the scarcity of available properties have been frequent in recent times.
But Paragon Homes chief executive Nigel Terrington has hit back at such claims.

Mr Terrington has said the reverse is the case. Far from being the enemy of the
would-be first-time buyer, the buy-to-let sector has been an invaluable help.

He said: \"Landlords stepped in to meet the demand from people needing flexibility in
their choice of housing, as well as those who are deferring their decision to buy a
home in an environment of rising interest rates.

\"The latest rise in borrowing costs may cause some prospective homebuyers to stay in
rented accommodation for longer - buy-to-let helps fill the housing gap.\"

Mr Terrington said that the situation was a win-win one for both parties. Paragon\'s
figures show annual rents rising by 13.6 per cent in the buy-to-let sector, higher
than its house price index which shows annual growth currently at 10.5 per cent.
This has resulted from population growth, particularly from increased numbers of
immigrants. (groups which are of course less likely to seek to buy, in the former
case because they may be looking to return to their country of origin in due course,
while the latter tend to be renting in their place of study and likely to move
elsewhere after graduation)

Giving an upbeat assessment, Mr Terrington concluded: \"Not only does buy-to-let
generate good returns for investors, but it also performs an invaluable function in
providing flexible, affordable housing for a wide variety of tenants. The buy-to-let
market remains robust, and all the indicators point to further growth in the
future.\"

But does the strength of the market ring true? Inevitably, there will be those who
question how well buy-to-let is doing, such as an article in the Daily Telegraph
yesterday about those whose buy-to-let investments fail. Of course, not every
investment succeeds, but then that is true of just about any part of the private
sector.

Evidence that the sector does remain strong was provided by Barratt\'s Homes, where
the rush to buy into new housing developments in the south-west indicates the market
is healthy, reports Easier Property. Caroline Hill, sales director at Barratts,
said: \"Despite recent reports of a slowdown in the buy-to-let sector, the market
remains buoyant.\"

Nor is this an isolated regional phenomenon. Research by Property for Life showed
that 57 per cent of buy-to-let investors are in the south-east, reports Mortgage
Solutions. That may not surprise many, but the figures showed that the north-west
comes second in the table at 11 per cent. Thus the evidence is not only that rents
are rising and demand remains high, but also that the benefits of buy-to-let are not
just being enjoyed by investors in any one part of the country.


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