Buy-to-let lending 'falling'

Posted: 28 Aug 2008 14:33:17 GMT

            Property News - Buy-to-let lending 'falling'

Landlords borrowed less money for buy-to-let property purchases in the first half of 2008, as the credit crunch caused borrowing conditions to tighten, according to new research.

Figures published by the Council of Mortgage Lenders (CML) indicated that the buy-to-let sector is being affected by the same conditions that are constraining the wider mortgage market, despite the fact that the private rented sector is currently enjoying increased tenant demand and rental yields.

In total, 144,600 buy-to-let loans were issued in the first six months of the year, down from 169,500 during the corresponding period last year.

However, the CML noted that the decline was smaller than that witnessed in the general mortgage market over the same timeline.

Michael Coogan, director-general of the organisation, said: "The shortage of mortgage funding is creating similar problems for buy-to-let landlords as it is for other borrowers."

He said that the rental market would remain underpinned by strong demand as people who would like to buy a home are being forced to carry on renting for the time being.

Meanwhile, research from Abbey Mortgages has suggested that on in ten home owners is planning to make an overpayment on their mortgage in the next six months, despite the current gloomy economic outlook.

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