In my building in Paddington, west London, I figure it is now about £5,000 a year cheaper to rent a two-bedroom apartment than to buy one (assuming you do so with a 90% interest-only mortgage) despite the fact that asking prices in the building are already down 20 odd per cent from their highs a year ago.

The Times's own Merryn Somerset Webb (Her views are personal and investors should always seek professional advice) suggests the real "dead money" is what's currently being spent on property. Rent! she says:

Rents are low and in many places falling, thanks to the massive oversupply of properties available to rent from the nation's miserable gang of buy-to-let investors.

The rest of today's news:

Rents hit four-year high - RICS [Reuters]
Buy-to-let investors creep back into the market [Guardian]
Rents outpace house prices due to demand [FT]
Rents rise as first-time buyers struggle [Sharecast]
Rents outstripping house price inflation [ThisIsMoney]
Rents on the rise In2Perspective
Rental yields rise on continuing demand from FTBs [IFAonline]

Like they said... Her views are personal and investors should always seek professional advice.