Lending for buy to let mortgages at highest level in six years
Figures released this week has shown that buy to let lending has risen by over £2bn in just 12 months.
Data from the Bank of England revealed that lending jumped from £5.9 billion in 2013, to £8 billion up to the third quarter of this year. This is the highest quarterly amount since 2008 and has demonstrated that lending for buy to let mortgages has improved year on year since the market crash.
Figures also released this week from the Council of Mortgage Lenders (CML) showed an increase in buy to let loans for the third consecutive month.
The report highlighted that 19,600 loans were approved for buy to let in October this year, a monthly increase of 8% and an annual increase of 22%. The value of this lending represented £2.7 billion, a 29% increase since October 2013.
Changes to the stamp duty, announced last week, looks set to save buy to let investors £50 million each year, which is good news for property investors.
Experts believe the introduction of the mortgage market review and constant demand for rental property has hugely benefitted the buy to let market, and that its growth will continue into 2015.
Managing Director of Sequre Property Investment, Graham Davidson, comments on the latest report from the Council of Mortgage Lenders:
“First time buyer lending in October 2014 was up 12% against lending in the previous month and up 14% when compared to the same month last year. Similarly, buy to let lending was up 8% compared to the previous month and 22% compared to the same month last year.
These figures may be influenced by events of previous months such as the Scottish Referendum when potential buyers may have delayed their buying decision until after the Referendum but then returned to the market when a no vote was confirmed.
Leading up to the Chancellors Autumn Statement, there seemed to be a more general feeling that activity levels had dropped slightly so it will be interesting to see if future reports continue to show these increases being maintained. Despite the changes to stamp duty criteria, I would expect to see these increases decreasing slightly in future reports.”