Recently published statistics suggest that higher property prices and a raised bar, regarding lender’s view of rental calculations and other criterion, resulted in overall higher deposits made in 2016 for buy to let mortgages, by owners and investors. Landlords sought significantly higher loans, up to £10,000 and more, during the same time period. At the same time, actual loan values dropped by up to 3%.
Investors and landlords are noting the differences. However, the market for buy to let properties is still going strong. Obviously, there is some tightening of belts. However, would-be buy to let owners and renters are finding the capital for larger deposits and using the loans they get to secure their investments. Even with the hurdles of the process, the current lowered mortgage interest rates makes buy to let an attractive proposition.
- New research from The Mortgage Broker Ltd reveals that the average value of buy-to-let loans and deposits increased in 2016.
- The average loan to value dropped from 61.6% in 2015 to 59.7% in 2016 and the average deposit rose by 18.5% from £105,605 in 2015 to £125,016 in 2016.
"The statistics show that landlords borrowed an average of £15,000 more to purchase property in 2016, compared with the previous year, with the average loan increasing in 2016 to £185,188, from £170,268 in 2015."
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