Over the past six months, buy to let lenders have advanced 130,400 loans, which is a rise of 39% over the previous period. The Council of Mortgage Lenders figures show that the value of buy to let lending in the last six months was £14.6 billion, which was 47% higher than in the first half of the year. The total number of buy to let mortgages stood at 701,900 at the end of the year.
The market is now worth £73.4 billion, and makes up 8% of the total property market. The average maximum loan to value is now 85%, and lenders now expect monthly rental income to exceed mortgage payments by at least 25%.
Our view
When the housing market slows, demand for rental propertis increases hence the increase in 'buy to let' lending. Beware though that owning second propertes may cause you to be libale to Capital Gains Tax on the profits.
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