According to a survey by Paragon Mortgages, 20% of all remortgages are done to purchase second properties. This is an increase of 5% over the last 6 months.
Apparently, 51% of all lending during the period was taken up by remortgages. 12% represented buy to let mortgages and only 10% for first time buyers.
Our View
With house prices soaring, many people have built up a large amount of equity in their homes. It is the equity that is being used to fund any second property. A word of warning though - watch out with interest rates rising and the potential for house prices to fall.
Unless you plan for it, you could end up with two properties, negative equity and large interest repayments to make. Alternatively, if you gain - you lose !
See our fact sheet on second properties and capital gains tax .