Demand for buy to let mortgages in the coming months is expected to fall “significantly” according to a Bank of England survey
The Bank’s Credit Conditions Survey, which monitors the expectation of UK banks and building societies, ironically found that lending on owner-occupation purchasing was likely to rise sharply in the second quarter of this year, but that the reverse will happen for buy to let mortgages.
The survey’s results came within minutes of a statement from the Council of Mortgage Lenders reporting that £3.7 billion in loans to landlords were released in February – a whopping 61 per cent rise on the same month in 2015.
“Activity has been boosted by landlords seeking to complete purchases before tax changes in April. We do not expect activity to show such strong year-on-year growth later in the year” says CML director general Paul Smee.
Some analysts believe there may be too much pessimism about. Jonathan Harris, director of mortgage broker Anderson Harris, says: “Buy to let goes from strength to strength but of course figures will be skewed by landlords bringing forward purchases to beat the stamp duty deadline. It is highly likely that purchase numbers will slip although we expect remortgaging to continue to thrive as landlords squeeze every penny out of investments to help cover other tax changes such as the reduction in mortgage interest tax relief.”
Yesterday we reported that Rightmove figures for the lettings sector show that in March the number of people saying they were planning to buy a property to let dropping 27 per cent compared to the same month last year.
