The Council of Mortgage Lenders have recently released figures which show that the number of buy to let mortgages that were issued in 2011 was around 80,000. This increase in the number of purchases for rental has increased the supply of rented homes available in the United Kingdom.
In the final quarter of 2011 it was estimated that around 35,000 buy to let mortgages were agreed, with a total value of around £4 billion. This was a very similar amount compared with the quarter before this but a significant increase on the same figures for last year, which was around £1 billion less.
Despite this relative increase, the figures are still significantly lower than the number of mortgages that were being issued during the property boom of 2007. In the third quarter of 2007 the value of mortgages issued was around £13 billion. The good news is that these latest figures point towards a continuing improvement in the buy to let market.
Figures show that buy to let mortgages represent about 10 percent of the total value of all mortgages in the UK. The repossession rate of buy to let mortgages is significantly higher than the repossession rate of owner occupied properties. This is generally because lenders are more likely to repossess the home of a property that is not occupied by the owner.
Paul Smee is the director of CML and he has recently commented, “The performance in the buy to let industry continues to be good and this is largely because the demand for property in the rental sector is high. It is a rational choice for people to buy property with the intention of letting it out and it is unlikely that this situation is going to change any time in the near future.”
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