Tenent loans have been declining as the housing market continues its downward spiral, although many people seem to be getting into the rental market as a result. This may result in an upsurge in tenent loans once the housing market stabilizes. For now however, banks are simply unwilling to take the risk that a tenent loan entails and those that still offer this type of loan are charging premium interest rates. For those that need a tenent loan, experts are encouraging them to wait out the current market conditions. They will eventually turn around and when they do, tenent loans should once again be made available on a larger scale.As Richard Donnell, Hometrack’s director of research, explains: “The extra cost and general market uncertainty is driving would-be purchasers into the rental market where renting is currently cheaper than buying - this was not an option in the late 1980s as the rented sector did not exist in its current form. However rental affordability is likely to worsen in the coming months on the back of rising rents which are up by as much as 20 per cent in some markets over the last year.”
Related reading: Tenent Loan
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