Investors choosing property over shares

Posted: 06 Jun 2006 08:49:25 GMT

As the government continues to lay emphasis on the importance of saving for retirement, increasing numbers are looking to property for the best returns.

A report in the Times recalls that back in 2000 when the technology bubble burst, thousands of investors decided that buy-to-let was the most profitable option. This led to a boom in the buy-to-let sector that has more or less been sustained throughout the last six years.

The Council of Mortgage Lenders argues that the number of buy-to-let mortgages actually increased by a staggering 483 per cent between 2000 and the end of 2005.

While the stock market eventually recovered and confidence returned, there are murmurings of discontent yet again due to recent volatility, according to Justin Urguhart Stewart from Seven Investment Management.

Because house prices have increased by more than share prices over the last ten years, property is inevitably seen by many as the preferable investment option, while consistently high demand from tenants is similarly boosting the buy-to-let sector.

The Royal Institution of Chartered Surveyors suggests that rents are now rising at their fastest rate in five years and so it is perhaps unsurprising that the sector is proving popular.


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