This article by Adam Williams of Mortgage Solutions on October 16th, 2013 tells us that buy-to-let market sustained its growth because landlords continue to expand their portfolios.
Landlords continued to expand their portfolios in the third
quarter of the year as the buy-to-let market sustained recent growth.
The Mortgages for Business index found that all areas
of the buy-to-let market barring semi-commercial investments grew
during the July to September period.
The number of buy-to-let products available rose by 4% compared to
the previous three months and the survey highlighted a strong
acceleration in residential buy-to-let purchases.
Despite this growth remortgaging figures remained high during the
quarter, making up 62% of the total market. Mortgages for Business said
this showed a demand from landlords for extra leverage.
The number of buy-to-let products on the market jumped from 465 to
484 quarter-on-quarter. The number of lenders operating in the sector
remained flat at 27.
David Whittaker, managing director of Mortgages for Business, said:
"It's encouraging to see a sustained improvement in the choice of
different mortgage products for landlords - and that competition should
help drive cheaper deals too.
"Rates remain low, and yields are consistently high, which is
encouraging landlords to increase activity. Confidence is generally high
- among both lenders and investors - which is sparking even more growth
in the sector. There are some other factors driving landlords to
remortgage - for example the continued turning away from the property
market by some Irish banks and RBS.
"However, for the most part there's such a huge amount of interest in
buy to let because of the potential returns on investment. Yields are
even higher just as landlords are starting to see prices rise more
seriously too, so we're expecting this surge of interest to continue.
Fundamentally, demand from tenants is as healthy as ever, and will
remain so for the foreseeable future."
Article Source: http://www.mortgagesolutions.co.uk/mortgage-solutions/news/2300883/jump-in-residential-buy-to-let-property-investment
Showing posts with label prices rise. Show all posts
Showing posts with label prices rise. Show all posts
Thursday, 17 October 2013
Wednesday, 11 September 2013
Mortgage Lending Booms as Iinterest Rates Hit Record Low
This article by Hilary Osborne of The Guardian on September 10th, 2013 shows that gross mortgage lending reaches highest level since the 2007 crash fueled by government loan schemes and economic optimism.
Gross mortgage lending reached its highest level since 2007 in the second quarter of 2013, as the cost of borrowing fell to the lowest level on record, according to figures from the Bank of England.
Sharp increases in the number of first-time buyers and buy-to-let landlords entering the market fuelled a busy three months for the mortgage industry.
A total of £41.6bn worth of new loans were advanced to borrowers, a 23% increase on the first quarter and 13% higher than in the same period of the previous year.
The quarter-on-quarter leap in lending is the biggest since 2007, when the housing market boom was in its final throes.
Lending to first-time buyers saw a big increase, as banks and building societies became less reluctant to offer mortgages to borrowers with small deposits. The Bank's figures show that the share of the market taken by mortgages at a high loan to value, which it defines as above 90% of the property's price, increased from 2.1% in the first quarter to 2.5%.
The value of mortgages advanced to new entrants in the property market was up by 31% year-on-year, at £8bn. Over the same period new lending for buy-to-let increased from £3.9bn to £5bn.
The mortgage market has been fuelled by a combination of factors, including positive economic data and government stimulus in the form of the Funding for Lending and Help to Buy schemes.
The impact of Funding for Lending, which offers banks and building societies access to cheap funds to encourage them to offer loans to businesses and households, is underlined by the Bank's data for mortgage interest rates.
It shows that the overall average interest rate on gross advances fell to 3.47% in the second quarter – the lowest interest rate on record.
Some of the low rates have encouraged remortgage activity, and net mortgage lending which takes into account repayments and redemptions showed a smaller annual increase than the headline figure, rising by 8.6% to a total of £5.1bn.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "Funding for Lending and Help to Buy are resulting in cheaper mortgage rates, which is encouraging borrowers to finally take the plunge.
"Growing confidence in the housing market as prices rise, particularly in London and the south-east, is also stoking the market."
Earlier, the Royal Institution of Chartered Surveyors became the latest organisation to warn that the Help to Buy scheme could push prices to unaffordable levels.
Rics said house prices in the UK were rising at the fastest pace in almost seven years, echoing similar data from lenders Halifax and Nationwide.
Article Source: http://www.theguardian.com/money/2013/sep/10/mortgage-interest-rate-record
Gross mortgage lending reached its highest level since 2007 in the second quarter of 2013, as the cost of borrowing fell to the lowest level on record, according to figures from the Bank of England.
Sharp increases in the number of first-time buyers and buy-to-let landlords entering the market fuelled a busy three months for the mortgage industry.
A total of £41.6bn worth of new loans were advanced to borrowers, a 23% increase on the first quarter and 13% higher than in the same period of the previous year.
The quarter-on-quarter leap in lending is the biggest since 2007, when the housing market boom was in its final throes.
Lending to first-time buyers saw a big increase, as banks and building societies became less reluctant to offer mortgages to borrowers with small deposits. The Bank's figures show that the share of the market taken by mortgages at a high loan to value, which it defines as above 90% of the property's price, increased from 2.1% in the first quarter to 2.5%.
The value of mortgages advanced to new entrants in the property market was up by 31% year-on-year, at £8bn. Over the same period new lending for buy-to-let increased from £3.9bn to £5bn.
The mortgage market has been fuelled by a combination of factors, including positive economic data and government stimulus in the form of the Funding for Lending and Help to Buy schemes.
The impact of Funding for Lending, which offers banks and building societies access to cheap funds to encourage them to offer loans to businesses and households, is underlined by the Bank's data for mortgage interest rates.
It shows that the overall average interest rate on gross advances fell to 3.47% in the second quarter – the lowest interest rate on record.
Some of the low rates have encouraged remortgage activity, and net mortgage lending which takes into account repayments and redemptions showed a smaller annual increase than the headline figure, rising by 8.6% to a total of £5.1bn.
Mark Harris, chief executive of mortgage broker SPF Private Clients, said: "Funding for Lending and Help to Buy are resulting in cheaper mortgage rates, which is encouraging borrowers to finally take the plunge.
"Growing confidence in the housing market as prices rise, particularly in London and the south-east, is also stoking the market."
Earlier, the Royal Institution of Chartered Surveyors became the latest organisation to warn that the Help to Buy scheme could push prices to unaffordable levels.
Rics said house prices in the UK were rising at the fastest pace in almost seven years, echoing similar data from lenders Halifax and Nationwide.
Article Source: http://www.theguardian.com/money/2013/sep/10/mortgage-interest-rate-record
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