IT WOULD APPEAR THAT THE CONTINUING POOR INTEREST RATES ON SAVINGS, COUPLED WITH A BOUYANT LETTINGS MARKET, HAS LED TO CONTINUING ACTIVITY IN BUY TO LET INVESTMENT.
The value of buy-to-let mortgages taken out in the third quarter of 2012 totalled £4.2billion, an increase of 8% over the £3.9billion advanced in the preceding three months, according to data from the Council of Mortgage Lenders.
The number of loans advanced in the three months to the end of September totalled 34,400, 2% more than in the second quarter of 2012 (33,600).
The latest data means that the value of buy-to-let lending in the first nine months of 2012 amounted to £11.8billion, 19% higher than the £9.9billion advanced over the same period in 2011. But buy-to-let activity is recovering from a low base and remains subdued compared to the pre-credit crunch era. Buy-to-let lending this year is likely to total a little over one-third of its peak in 2007.
The stock of buy-to-let mortgages continues to grow. At the end of the third quarter, the number of outstanding loans totalled 1,444,000, worth £164.3billion (up from 1,414,000, worth £162.5 billion, at the end of the second quarter, and from 1,367,000, worth £156.7billion, a year earlier).
CML director general Paul Smee said: “Buy-to-let lending is continuing to recover, and to grow in line with expectations. As well as continuing to fund owner-occupation, lenders are contributing to the expansion of a strongly growing rental sector, helping to deliver choice and mobility for tenants. The growth of private renting looks set to continue in the years ahead, and lenders are committed to playing a full part in the debate about how best to meet the evolving needs of tenants in the future.”