The London Buy-to-Let Boom Meets Higher Borrowing Costs

Emma Reynolds inherited two apartments and a store in London, then saved to buy a cockroach-infested investment property last year. Like Bank of England Governor Mark Carney, she’s worried about landlords pushing up property values with cheap money.

Large numbers of amateur investors are “doing it purely because of interest rates and they just see quick bucks,” said Reynolds, who is spending 25,000 pounds ($39,000) renovating her south London rental and hopes to become a full-time landlord. “It got overheated because people who would normally invest their money somewhere else were not getting a decent rate of return anywhere else.”