Buy To Let Optimism Rises

There is growing optimism in the lettings market as buy to let mortgage applications and availability of finance increases.

According to the Financial Adviser Confidence Tracking (FACT) Index from Paragon Mortgages, 50% of mortgage intermediaries reported that buy to let mortgage applications increased during the second quarter.

On average, the intermediaries interviewed conducted over 5 more buy to let business in Q2 than in the first quarter.

Over 60% of intermediaries also felt that the availability of buy to let finance also improved significantly during the past three months.

The FACT Index also revealed that over 70% of all cases introduced by financial advisers in the second quarter were for residential mortgages, and 20% were for buy to let mortgages.

Of note is that 47% of buy to let mortgages processed by intermediaries in the second quarter were for landlords looking to extend their current portfolios, up from 43% in the first quarter.

Mortgages for first-time landlords totalled 21% in Q2, up from 18% in Q1.

John Heron, Paragon Mortgages Managing Director, said: “Government statistics just released indicate that more than 17% of English property is now in the private rented sector. All of the market indicators, however, suggest that there is still not enough property for new tenants.

“Better availability of buy to let finance, particularly for professional landlords, is critical to the expansion of the supply of rental property.

“It’s therefore, good to see that this is starting to come through.”