Buy-to-let mortgage market recovery continued during June, according to new figures released by the Council of Mortgage Lenders.
Data from the report suggests that the number of loans increased by 12% month-on-month since May. Buy-to-let landlords were found to have borrowed £2.9bn. However, this was substantially down on the volume of loans recorded during June 2015.
Stamp Duty slide
The number of investors looking to acquire property has slipped since the 3% stamp duty surcharge was introduced at the beginning of April. There was a 15% year-on-year decline in buy-to-let investment during June, although many landlords brought forward purchasing arrangements in order to beat the deadline.
Paul Smee, director general of the Council of Mortgage Lenders, noted, ‘buy-to-let house purchase activity remains lower than before the stamp duty changes at the beginning of April, but showed a large month-on-month increase. As might be expected, buy-to-let remortgage seems to have been less affected by the changes and remains consistent with lending last year.’
What’s more, overall June mortgage lending was up by 29% month-on-month and by 12% year-on-year.
Stephen Matthews, director at London estate agent Greene & Co, suggested that purchase activity remains constant. Many landlords could soon be looking for suitable landlord insurance as the market picks up.
Matthews noted, ‘The data shows first-time-buyers continue to be a driving force in house purchasing lending, outperforming home movers for the third month running, and up 25% annually. Nevertheless, the number of home movers has risen by a healthy 5% year-on-year despite Brexit jitters and the accompanying uncertainty surrounding future economic stability.’
‘Buy-to-let house purchase activity still remains lower than before the changes to stamp duty at the beginning of April, which has had a bigger impact to annual lending than the EU referendum. However, it is clearly evident that private landlords are beginning to return to the market, as we see a large month-on-month increase,’ he added.