CML reveals buy-to-let boost to lettings market

The number of properties being bought with buy-to-let mortgages increased by around 84,000 in 2011, according to data from the Council of Mortgage Lenders.

During the fourth quarter of 2011, a total of 34,800 buy-to-let mortgages, of which 15,600 were remortgages, were advanced, with a total value of £4bn.

This was virtually identical to the volume of business in the third quarter but up on the fourth quarter of 2010, which recorded 26,300 loans worth £2.9bn.

Compared with the height of the market in the third quarter of 2007, when quarterly lending totalled more than 93,000 loans worth £12.7bn, the buy-to-let market continues to operate at relatively subdued levels, but it is clearly continuing to recover from its low point of 2009.

Buy-to-let mortgages account for nearly 13 per cent of the total outstanding value of mortgages in the UK, and buy-to-let lending represented nearly 11 per cent of total gross mortgage lending in the fourth quarter of 2011.

Paul Smee, director general of the CML, said demand for rented property remained high, so the rationale for buy-to-let remained strong, and there was “little reason” to foresee any change to this positive outlook for the sector.

He said: “These figures do not suggest that buy-to-let is crowding out first-time buyers; more that it is performing a really important role within the overall housing market.

“The benefits of the availability of good quality, private rented housing should not be overlooked, especially as there are many households which need the flexibility and mobility that the private rented sector is well placed to provide.”