November 22, 2011
While the availability of house purchase loans continues to suffer, the number of buy-to-let loans issued recently has gone the other way entirely.
Figures from the Council of Mortgage Lenders (CML) show that the number of new buy-to-let loans increased by 16% in the third quarter of 2011, while during the same period, the value of mortgages advanced in the sector grew by 19%.
According to the stats, in the three months to September, a total of 34,500 buy-to-let loans were advanced, representing an increase from 29,700 on the second quarter. In total, the value of lending reached £3.8 billion, up from £3.2 billion.
“With tenant demand remaining strong in the rental sector, some existing buy-to-let landlords have been expanding their portfolios and the growth that returned to the sector in the preceding quarter has continued,” Paul Smee, Director-General of CML told thisismoney.co.uk
In the third quarter, there were 18,580 loans for the purchase of buy-to-let properties, accounting for almost 12% of all house purchase loans. However, this is still significantly lower than the first quarter of 2008, when 32,650 mortgages for buy-to-let property purchase accounted for 19% of all loans for house purchase.
“The recovery of buy-to-let from its low point in 2009 has helped improve supply and choice in the rental market,” added Mr Smee. “Despite recent improvements, however, buy-to-let lending volumes are still only around one-third of their former peaks.”
