UK Buy to Let Sector Mortgages Bounce Back

By: MoneyFacts

The number of buy-to-let mortgages has risen to the highest level since October 2008.

There are currently 463 buy-to-let mortgages available, compared to 312 six months ago and 299 in May 2010.

The number of lenders offering buy-to-let deals has risen from 48 last May to 64 today.

                                                          Buy-to-let product availability
 

As the availability of buy to let deals has increased, the average interest rate has fallen.

                                                             Buy-to-let average rate             

Louise Holmes, spokesperson for Moneyfacts.co.uk, commented: “The financial crisis saw many lenders withdrawing their rental products, with some lenders such as Paragon exiting the market altogether.”

“The demand for rental properties has increased over recent years, mainly due to the credit crisis. The majority of high loan-to-value deals were withdrawn from the residential mortgage market, leaving dejected borrowers little choice but to rent rather than purchase a home.”

“Buy-to-let has always been considered a high risk area of the mortgage market. A lack of rental demand can leave borrowers at risk, particularly those who have small portfolios or rely on rental income to fund their monthly mortgage repayments.”

“These latest figures, particularly the reduction in the average rate, suggest that the buy-to-let market could be returning to a competitive state. This will no doubt please landlords and property investors who have endured a tough time over the past few years.”

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