The latest results from the long running series of intermediary research from Paragon Mortgages has revealed that more than a third of intermediaries saw an influx of buy-to-let business in the final quarter of 2011. The same survey also established that on average 23.3 per cent of an intermediaries’ business was now buy-to-let, compared to 19.3 per cent a year ago.
The Financial Adviser Confidence Tracking survey (FACT) asked intermediaries what the most popular reason for landlords obtaining a buy-to-let mortgage was in Q4. Intermediaries said that four out of 10 landlords were taking out buy-to-let mortgages in order to expand an existing property portfolio, whilst a third of landlords were taking advantage of greater competition in the sector to remortgage. On average intermediaries saw an increase in their buy-to-let business of 4.5 per cent in Q4.
Most strikingly perhaps those surveyed also reported an increase in first-time landlords applying for their first buy-to-let mortgage, rising from 19 per cent in Q3 to 23 per cent in Q4. This continues the improving trend that has been recorded with the proportion of first-time landlord business now more than double the levels at the peak of the financial crisis.
When asked for their views on what the likely availability of buy-to-let finance would be in the first quarter of 2012, half of intermediaries said that they thought availability would improve and 41 per cent said it would remain the same.
John Heron, managing director of Paragon Mortgages, said: “The final quarter of 2011 was for many intermediaries a successful one, with increased optimism about the coming months and a steady improvement in the level of buy-to-let business being written. With record levels of rental demand being reported it is good to see that existing landlords are increasing the size of their portfolios but it is particularly notable that the proportion of new landlords is also increasing.”
“If these trends are maintained through early 2012 it would seem that the broad expectation of a further expansion of the buy-to-let market in 2012 is well founded.”
