The perversity of capitalism was demonstrated in a report by mortgage lender Paragon Mortgages published at the end of April. Its analysis of the housing market shows that the return to landlords on their buy-to-let investments averages 16.3 per cent a year since 1996.
Playing the roulette wheel of the stock exchange would have yielded 6.8 per cent, buying bonds 6.5 per cent, and old-fashioned savings in the bank a mere 4 per cent. Forecasts for the next decade indicate a return of 11 per cent or more.
Since 1996 buy-to-let landlords have taken out mortgages worth £174 billion and now control almost 20 per cent of the housing stock. A survey in March by Generation Rent indicated that a third of tenants surveyed were cutting back on food so as to pay increasing rents. An estimated 9 million people live in the private landlord sector.
Buy-to-let landlords hardly existed before1996, when the then Tory government introduced legislation that manipulated the housing market to cover up economic stagnation, as George Osborne is doing now with the Help to Buy scheme. ■