Scotland is set to become a nation of tenants rather than home owners, according to a leading figure in the rental industry, Clear Property Investment heard this week.

The comment has been provoked by rising levels in tenant demand for properties. Indeed David Alexander, who runs a letting agency in Edinburgh, says the demand is unprecedented and the highest he's seen in 28 years in the industry.

It means interest in the buy-to-let market is growing, with more mortgage lenders starting to widen choice in the field. Only last week a survey by the Council of Mortage Lenders (CML) reported 26,900 buy-to-let mortgages were agreed for the third quarter ie July, August, September this year.

And the increased demand doesn't look as if it's going to quieten down any time soon.

One senior technical manager at broker John Charcol told the Scotsman newspaper: "People are having to rent for longer and the proportion of people who want to buy but can't means rental demand is bound to increase," he said. "So we'll see more landlords coming back into the market and lenders are once again offering deals at 80 per cent loan-to-value."

He cites Nationwide as being one of the bigger players in the buy-to-let lending area.

"Nationwide is in a good position to beef up its buy-to-let book and earlier this year expanded the types of property it lends on," the Charcol broker employer added.

Meanwhile, Alexander points to a change in the demographic when it comes to renting, claiming it's mostly families seeking three bedroom accommodation with a garden that he's dealing with. In the past the rental market would have been populated by young single people or couples.

"Demand has become particularly strong for houses with gardens because of the growing numbers of couples with children who see no point in buying at present or who are simply unable to secure mortgage finance due to tough restrictions, including high deposits," said Alexander.

Alexander too, does not see this situation changing in the near future, believing that families will continue to rent and look to build up capital provision by some other means.

And private landlords will be very much in demand due to a limited supply of social housing. At present there are around 1.8 million individuals or families in Britain seeking social housing. However supply is just not there, thanks to tough building regulations in recent years.

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