The number of buy to let landlords in the UK has rocketed in number since 2000 and have racked up debts worth £200 billion to fund their property ambitions, says the Bank of England.
In 2000, the buy to let debt in the country was valued at £10 billion but today it's risen to around 15% of all home loans.
The bank is now warning that the debt could create a risk for the banking system and is concerned that lenders are fighting a price war and cutting interest rates.
This is leading, the bank says, to more potential buy to let landlords entering into the sector which is also fuelled by people accessing their pension pots to invest in property.
The bank is warning that landlords new to the private rental sector will be hit hard should interest rates begin to rise since most buy to let mortgages are not on fixed rates but interest only.
New buy to let landlords forced to sell properties?
The main worry in this situation is that many of these new buy to let landlords would then be forced to sell their properties in large numbers which could spark a dramatic price fall - similar to that seen in the 2007 credit crunch.
According to some buy to let mortgage experts, there are now more than 900 financial products available to potential landlords - that's a threefold rise in five years.
Competition between lenders has also driven down mortgage interest rates on a buy to let mortgage to be similar to those seen on standard residential loans.
Indeed, landlords can find buy to let mortgage deals at 3.49% which is just 2% above the normal residential mortgage rate.
There are now around 2.1 million landlords with private rental properties in the UK today, they own around 4.6 million homes or an average of two properties each.
The number has risen from 1 million landlords recorded in 2007.
Local authorities crackdown on houses in multiple occupation
Meanwhile, a campaign around the UK by councils to crackdown on the safety of houses in multiple occupation (HMOs) has led to a growing number of landlords being prosecuted.
Indeed, the council in Barnet in London has now implemented an amnesty for HMO landlords who do not have a landlord licence to apply for one or face prosecution.
The council in Camden is also looking to introduce new licensing rules for which landlords must meet minimum standards.
Among the other councils looking to enforce HMO legislation or to restrict the growing sector is Lincoln which is planning to limit the number of new HMOs in its area by implementing new planning rules before a property can be converted by a landlord.
