Buy to let mortgages becoming more popular

16/08/2007

The buy-to-let market has developed intensively during the past decade.

The Council of Mortgage Lenders (CML) stated there were 938,500 of the loans, as a group worth 108 billion pounds. It is greater than a 50-fold increase in terms of value since 1998, when there were only 29,000 of the loans, worth 2 billion pounds.

Buy-to-let loans now account for 10% of all mortgage balances, compared with just 3% only five years ago.

Figures have showed that buy-to-let loans now take up 10 per cent of the property sector. Looking at these figures five years ago it took only 3 per cent of the market.

The market was actually being fuelled by tenant demand, leaving potential investors to invest in property more.

The CML stated: "All the signs are that the buy-to-let sector will continue to expand. The UK has one of the lowest proportions of housing stock in the private rented sector of any industrial economy.

"The increasing numbers of students, the significant inflow of migrant workers and the growing demand for flexibility of tenure will all help the buy-to-let sector develop over the coming years."

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