Britain's deflating buy-to-let bubble

It sounds too good to be true.

Take out a mortgage to buy a property and then, while the rent covers the mortgage repayments, the capital value of the property increases year on year.

For many years, that was the way it was, but now there are signs that the years of easy money may be coming to an end.

In 1996, when buy-to-let mortgages were first launched, only 20,000 were taken out. By June 2007 this figure had grown to 940,000 and the total amount borrowed to £108bn.

It has been phenomenally successful and one of the best performing investments around.

Many buy-to-let investors have made fortunes as house prices increased and mortgage rates remained low.

One such investor is Raj Shastri who has seen his initial £950 investment grow over the last five years into a portfolio worth £8m.