Buy-to-let mortgage lending hits record share, says CML
http://www.bbc.co.uk/news/business-22463650 Version 0 of 1. The buy-to-let sector now accounts for a record portion of total mortgage loans in the UK, according to lenders' data. Buy-to-let lending stood at 13.4% of all outstanding mortgages at the end of March, up from 12.9% a year earlier. Property investors have been taking advantage of low interest rates and have been attracted by high rents. However, the rise could mean that some potential new buyers find themselves competing for a home with investors. 'Engine room' The first three months of this year saw £4.2bn of buy-to-let mortgage lending, according to figures from the Council of Mortgage Lenders (CML). This was 12.4% of the total - up from 11% a year ago and the highest since the credit crunch in 2008. "Low interest rates have scored a double whammy - both making mortgages cheaper and making buy-to-let a substantially more attractive investment than low-paying savings accounts," said Ben Madden, managing director of letting agents Thorgills. "No wonder buy-to-let has become the engine room of the property market as a whole." However, total lending to buy-to-let investors remains well below its peak. There was £12.7bn borrowed by investors in both the third quarter of 2006 and the same quarter a year later. Giles Hannah, managing director of agency VanHan, said demand from tenants continued to fuel growth in the sector now. However, he warned that extra costs could become a factor if the government continued with plans to ensure landlords check the immigration status of tenants. Gas checks Meanwhile, a campaign has been launched to urge landlords and letting agents to conduct gas safety checks at homes. In a survey for housing charity Shelter and British Gas, one in 10 people said their landlord or letting agent had failed to ensure a gas safety check was carried out in their home in the past year. An annual gas safety check and certificate is required by law and is the legal responsibility of the landlord. The checks are designed to pick up a range of problems such as faulty boilers, and help to prevent gas leaks, explosions and carbon monoxide poisoning. "It is shocking to think that in thousands of households across the country there are accidents waiting to happen because a simple safety check has not taken place," said Campbell Robb, chief executive of Shelter. "For households with children, this is an even bigger concern. Renters have a right to know that the property they are living in is safe." |