Buy-to-let recovery

The arrival of two new lenders.............

The arrival of two new lenders in the buy-to-let mortgage market this week, as well as a revival in the lettings market, has helped boost the beleaguered sector.
On Monday, Precise Mortgages, backed by US-based private equity firm Elliot Associates, and Aldermore Bank, which is owned by venture capital company Anacap Financial, both began offering a range of new mortgage products for property investors.
This move came as Paragon – the third biggest buy-to-let lender at the peak of the housing market – signalled its intent to return to new lending later this year after withdrawing from the market in 2007.
“The launch of two new lenders just after The Mortgage Works increased its loan-to-value on buy-to-let loans to 80 per cent is a very positive sign for the buy-to-let market,” said David Whittaker of Mortgages for Business, the mortgage broker.
The buy-to-let market has been badly hit by the credit crunch, with the number of products plummeting from 6,662 in August 2007 to just 304 last week.
But the sector is showing signs of a turnaround. The number of mortgage products has increased to 70 per cent since September last year, according to Money-facts.co.uk
Rents have also started to rise again across the UK, according to The Royal Institution of Chartered Surveyors (RICS). “This is good news for landlords as rents are set to move higher in the coming months and yield returns are likely to improve,” said Jeremy Leaf of RICS.

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