Survey: Majority of investors holding on to properties

Owners of buy-to-let properties are unwilling to sell for anything less than what they paid for them, according to research.

A survey carried out by Trinity Professor Brian Lucey, mortgage expert Karl Deeter, and Marie Hunt of estate agents CBRE, found the vast majority of investors are holding on to their properties as their rent rolls are covering the mortgages.

The survey of almost 500 buy-to-let mortgage holders painted a picture of the typical investor as a man aged between 35 and 65 who invested in up to three properties close to where he lives. It found most of the investors were realistic about the drop in values that their homes had taken including:

* 57% believed values had fallen by more than 50%, which is in line with CSO and other data.

* 35% believed that their residential investments had declined by between 50% and 60% from peak.

* 22% believed that their properties had declined by more than 60% from peak.

Ms Hunt said it was “all very well” that investors were holding on to their properties “in the current low-interest rate environment and while mortgages are on interest only terms”.

“However, the concern is that once interest rates start to increase or these mortgages move off interest only terms as they inevitably will have to, this will become an issue for many of these investors.” She said investors “are potentially postponing the inevitable”.