Director at consultancy Mouseprice Selwyn Lim noted that such investors took advantage of easy access to finance.
"Huge increases in house prices across the country have been driven primarily by easy access to money, before the credit crunch it was very easy to get a mortgage," he explained.
And Mr Lim added that cities in the north of England saw much of the investment, but prices became vulnerable when the economic downturn began.
He was speaking following the release of Mouseprice's Annual Street Rankings 2008, which showed that the ten most affordable streets are all in the north-west, north-east and Yorkshire and the Humber.
A recent survey by the Telegraph found that the value of new purpose-built investment properties has dropped by 40 per cent over the last year.
