Are buy to let mortgages on the increase?
It was clear throughout the credit crunch that buy-to-let market and property investment had not died out as some had previously predicted, even if some less wise investors had exposed their errors by the fall in values and being unable to make a quick return.
However, at the same time many investors have taken advantage of the recent property slump, offering cash rich investors to be able to pick up some great investment property bargains. In addition, the inability of first time buyers to get on the property ladder has had an impact on the property market. This means that they would need to rent, so property investors could also fill their properties reasonably easily.
An investor who had bought wisely would just be able hang on to their property and ride out the recession, as they know a price increase is not far off.
Although this might be the experience for some investors, there are also individuals who want to invest but cannot start or add to existing portfolios because of the current buy to let mortgage market. According to a survey carried out by Money Supermarket, the number of enquiries over the past year regarding buy-to-let mortgages rose by almost 50%, but the number of agreed buy-to-let mortgages dropped by over 70%.
The marketing manager at Mortgages for Business, Michael Aglony, he remarked that the lack of buy-to-let mortgage competition has had an impact on the market, and that if the Bank of China is to arrive in the market then this might change. So far it has not appeared to have happened though.
He also mentioned that as lenders try to reach their end of year targets, more firms will be encouraged to lend again.
Whether this does happen before the end of the year though still remains to be seen.