Buy-to-let enquiries from investors looking for property purchase loans surged sharply at the end of last year, according to new figures.
The latest Mortgage Market Tracker from the Intermediary Mortgage Lender’s Association (IMLA) shows that enquiries from investors seeking to invest in the buy-to-let sector rose dramatically in the last three months of 2016.
Buy-to-let enquiries rocketed by 47% in the fourth quarter (Q4) of 2016, as investors looked to beat the Prudential Regulation Authority’s (PRA) stricter buy-to-let lending criteria, which was introduced at the start of this year.
Mortgage lenders expect overall demand for buy-to-let mortgage lending to continue in the first three months of this year, albeit at a lower level, as a result of the tougher lending conditions and the forthcoming changes to mortgage interest tax relief for landlords.
From 6th April 2017, the amount of tax relief that landlords can claim on their mortgage interest and other finance costs will be gradually restricted to the basic rate of Income Tax. This guide explains how the change will affect you: https://www.justlandlords.co.uk/news/landlords-guide-mortgage-interest-tax-relief-changes/
The Executive Director of the IMLA, Peter Williams, comments on the buy-to-let enquiries data: “It is unsurprising that there was an increase in the numbers of borrowers seeking expert advice in the final quarter of 2016, given that the changes to buy-to-let underwriting standards and mortgage tax relief were looming large on the horizon.
“As the layers of regulation in the market become increasingly complicated, and the number of products increase, the intermediary market continues to play a very important role in the provision of mortgage finance to a variety of borrower types.”
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