Is The Daily Mail insane?
IS the Daily Mail insane? This headline is simply unbelievable:
Record number of buy-to-let mortgages worth more than £160bn drives up rent bills
In what universe does an increase in the number of houses for rent push up the rent of houses?
They’re insane: and increase in the number of houses to rent will push rents down, not up.
Now, it is true that rents are going up. Population is going up too and as we know there aren’t all that many houses being built. Those who would like to buy a house are also finding a mortgage very hard to get: or the high deposit impossible to save. These mean that there are more people looking to rent: and yes, higher demand does indeed mean higher prices.
But buy to let landlords are pushing rents in the other direction. The more people there are trying to rent out a house the lower they push rents. What happens to rents in total depends upon the balance of the two effects, higher supply or higher demand.
But I’m sorry, this really is true: blaming people trying to rent out houses for rents going up is just insane.
Posted: 10th, August 2012 | In: Money Comment | TrackBack | Permalink
