The Council of Mortgage Lenders has announced that new buy-to-let mortgages totaling more than £5.1 million were arranged in the second half of 2013. This was the highest level since the third quarter of 2008. The total number of new mortgages arranged was 40,000, again the highest level since 2008.
Buy-to-let is enjoying a recovery, but from a low base following the financial crisis. The total number of new mortgages was 19% higher than in the preceding three months and buy-to-let mortgages now account for 13.3% of outstanding lending in the UK. Year on year, the amount of lending on buy-to-let mortgages has risen by 31%.
Around half of all buy-to-let mortgages were for house purchases but growth in remortgaging of 29% points to improved conditions in the mortgage markets encouraging landlords to seek more preferential loans.
Since the financial crisis lenders have been reluctant to lend to prospective buyers without a sizeable deposit. This has resulted in frustrated homeowners turning to rented accommodation while they save for a deposit.