UK
Ireland
Scotland
London
.gif)
At £2.1 billion, lending was 10% higher than in the previous three months. The third quarter also saw a similar first increase in two years in the number of buy-to-let loans advanced, from 21,600 to 23,700. But the welcome recovery in buy-to-let lending was from a low base, with current lending volumes sharply lower than their peak in 2007.
The number of outstanding buy-to-let loans grew to 1,205,000, representing 11% of all mortgages by the end of the quarter (compared to 1,180,000 three months earlier). The value of outstanding buy-to-let mortgages increased by 2.5% to £144.2 billion.
-- Advertisement --
Within the buy-to-let market, both lending for house purchase and remortgaging grew in the last three months. As with the mainstream mortgage market, however, house purchase lending was appreciably stronger. Remortgaging capacity was constrained by the unavailability during the quarter of any buy-to-let mortgages at over 80% loan-to-value (LTV). Landlords with existing mortgages at a higher LTV are therefore effectively obliged to stay on their existing lenders' reversion rates. But with variable interest rates remaining low, it is relatively painless for them to do so and there is little pressure to re-finance.
CML Director General Michael Coogan said: "At this stage, the recovery is modest - but the figures show that buy-to-let is here to stay. Buy-to-let lenders are among those facing some of the biggest challenges in raising mortgage funding, so the improved figures are all the more welcome.
"Future demand for housing in all tenures supported by lenders will remain strong, despite mortgage funding constraints and low construction rates. With funding for social housing under pressure, the private rented sector has a strong future. Mortgage lenders will have an important role to play in it, and will continue to help improve choice and standards for private tenants."
(CD/GK)
