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by IkmoIkmo 1745 days ago
No, that's not the claim. There's waterbed effects. Buy-to-let is done for the purpose of renting. If you take that rental supply away, rental prices go up, and demand for homes go up. Taking away buy-to-let demand thereby creates other demand that buy-to-let was supplying. You're just replacing the demand, not removing it.
1 comments
skybrian 1745 days ago
Could you spell out why this doesn’t just move demand around? Aren’t the same number of people as before looking for a place to live?

(I also don’t know what you mean by “waterbed.”)

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IkmoIkmo 1744 days ago
It does just move supply/demand around, that's the waterbed effect.

If you remove buy-to-let investors, then buying a home becomes easier, but not necessarily any cheaper, because the rental supply (from buy-to-let) drops and therefore the prices of rentals go up, thereby increasing the demand for buying a home, countering the lower demand from buy-to-let investors. Demand has been moved around, the shortages are still as big, and there's no significant effect on prices.

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