Buy to let mortgages outnumbered by first-time buyers


The latest figures from the Council of Mortgage Lenders (CML) show that spite a boom in buy to let lending in 2015, the number of first-time buyer mortgage approvals outnumber them.

Indeed, loans being made to landlords were outnumbered by three to one with 311,700 mortgages being approved last year for first-time buyers.

This is a similar number to the approvals seen in 2014 but the amount being loaned set a new post financial crash record of £46.7 billion.

There was a slight downturn in the number of home movers taking out mortgages – they fell by 0.2% to 365,800 approvals with another post-2007 record being set at £72.1 billion.

However, by to let mortgages have grown by value, up by 39%, as well as by volume, up by 28%, to also achieve a new record figure.

Buy to let landlords have an unfair advantage over homebuyers

John Heron is the managing director of Paragon Mortgages and he said: “There’s a common accusation that buy to let landlords have an unfair advantage over homebuyers but the data suggests this is not so with buy to let only making up 11.6% of purchases.”

However, landlords have been rushing to buy rental properties in a bid to beat the 1st April deadline which sees a stamp duty hike.

House prices are also rising, according to the Office for National Statistics with the average UK house price in 2015 being £301,000 for homes in England, in Wales the figure is £175,000 and in Scotland it is £193,000. The average price for property in Northern Ireland is £148,000.

Not surprisingly Londoners have the highest average property price of £536,000 while the lowest at £155,000 is found in the north-east.

In other good news from the CML is that mortgage arrears are now at their lowest for 10 years.

The latest data reveals that less than one in 1,000 mortgages ended with a repossession. Currently, 1.03% of all loans are in home owner mortgage arrears.

Bridging finance takes 2% share of mortgage market

Meanwhile, the bridging finance sector in the UK continues to grow from strength-to-strength and now accounts for 2% of the mainstream mortgage market.

The Association of Short Term Lenders says that bridging loans worth £2.59 billion were made in 2015.

Now some of the leaders in the bridging loan field say that the industry will continue growing as more mortgage brokers and potential borrowers appreciate the potential of bridging finance.

The rising popularity of bridging finance

West One Loans’ director, Duncan Kreeger, said there could be no end to the rising popularity of bridging finance.

He explained: “Houses are becoming more expensive with people looking to buy a property in need of renovation so bridging loans help buy properties that a High Street bank will not lend on.”


Mr Kreeger added that the growing popularity of buy to let was also helping entrepreneurs access the market with bridging loans.