Good news this past week for both prospective landlords and those looking to rent, as it emerged that buy-to-let lenders have enjoyed their busiest quarter since the 2008 financial crisis, as they approved mortgages worth £3.5 billion between April and July, a total of 32,000 loans.
As mortgage availability for first time buyers remains difficult, the rental market continues to strengthen. As a result, the demand from buy-to-let investors has picked up…. in July the Bank of England reported that there were about 600 buy-to-let products to choose from.
The Council of Mortgage Lenders has also confirmed that for the first time since 2008 the arrears rates for buy-to-let mortgages were lower than in the owner-occupied sector.
At 28,100 or 2.9% of the total, loans over three months in arrears in the buy-to-let sector were 0.05 per cent lower than in mainstream lending during the quarter.
As for rents, yields are up in the south east, having risen from 4.5% in July 2010 to 4.8% in July 2011 with Savills forecasting a 7% per cent rise this year.
Robert Gordon-James, owner of Martin & Co (Tonbridge), a leading lettings specialist, said:
“It’s clearly a good time for those thinking about entering the buy to let market - better terms for borrowing and rising yields. This is also good news for applicants as it increases the number of properties available for rent”.