More than one-third of buy-to-let cases introduced through mortgage brokers in the third quarter of this year were remortgage applications.
Specialist lender Paragon says that over four in ten of intermediaries’ landlord customers are now growing their portfolios.According to Paragon, 42% of brokers said more than half of their buy-to-let cases during the period were landlords looking to add to their buy-to-let portfolios.
When asked how they would describe the current level of landlord demand, 26% said that it was either strong or very strong, and 45% described it as stable.
The second most popular reason for landlords obtaining a buy-to-let mortgage in the third quarter was remortgaging, with 34% of intermediaries saying that was the case.
When asked for the reasons behind the remortgaging cases in Q3, the most popular reason was capital raising (44%), followed by 38% looking for a better rate of interest.Intermediaries are also expecting to increase the amount of buy-to-let business they do in the final quarter of the year, up by 4.2% on average.
John Heron, managing director of Paragon Mortgages, said: “There is incredible pressure now on rental stock. Letting agents in many regions are reporting that they simply do not have properties available for an increasing number of potential renters. In order to meet this increasing level of demand, landlords need to continue to grow their portfolios.
“It is very encouraging that intermediaries are seeing an increase in landlord clients looking to add further property to their portfolios in the coming months.“However, intermediaries have said that there needs to be greater innovation in buy-to-let, including access to higher LTVs. We hope to see more of this coming through during 2012.”
David Sansome, Managing Director at Sansome & George said: “With tenant demand outstripping the supply of property to rent we have seen rental levels in crease and landlords benefit from improved yields.
With a huge selection of attractive mortgage schemes available, it is clearly being seen by many as an ideal time to invest in residential property.”
