Oh dear I bought a buy to let flat

If you bought a buy to let flat recently you could be in trouble

http://news.bbc.co.uk/1/hi/business/7040061.stm

This shows how you are likely to have to subsidise your tenant for a few years.

If you cannot afford this you may make a stinging capital loss. Flat repossesions are in many cases achieving only 60% of their purchase price. So if you bought a 200k flat even with a 15% discount (who paid the full price?) for 170K your flat could only achieve 120K on a forced sale at an auction. This has been shown at auctions in Manchester, Birmingham, Norwich, etc.

So who wants to be in buy to let to achieve these returns

Certainly on one who who has bought recently. This may seem bad but it is only the beginning. The only buy to lets selling are the very savy or the ones going bust. How many will look to sell if they see no capital gains and low or negative income gains. This may cause a deluge of forced sellers on the market causing a viscious circle of falling prices and more forced sellers