Soaring rents and falling mortgage costs are making buy to let a better proposition than for many years – and lenders are starting to offer more flexible lending criteria, allowing more landlords into the market, according to Arnolds.
Their Residential Lettings department has uncovered a plethora of new buy-to-let mortgages on the market, many with less strict lending criteria than previously.
“As rental demand continues to increase, principally because first-time buyers are finding it more difficult to secure a mortgage, lenders are looking to strengthen their presence in the buy-to-let sector,” said Ashley Smith, Lettings Portfolio Manager at Arnolds.
“With continued low purchase prices, lenders can see that returns are hitting much higher levels compared with five years ago, and so are more prepared to approve loans for investors looking to increase their buy-to-let portfolio.”
Arnolds points to a number of moves in the buy-to-let mortgage market over the past months:
“This freeing up of finance for buy-to-let is good news for landlords in itself, but it also shows an expectation that rental demand will remain strong and yields remain high,” said Ashley Smith. “Although we are starting to see loan-to-value for owner-occupier mortgages creep up, the reality is that strict lending criteria are keeping many potential buyers out of the market, thus shoring up rental yields for some time to come.”
Posted By AndyNewman on Monday, November 28th, 2011
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