Paragon posts 9% jump in profits

Paragon posts 9% jump in profits

The parent company of Paragon Mortgages has seen its profits jump more than 9 per cent in a year, as the firm was helped by the influx of mortgage applications in the run-up to April’s stamp duty hike.

According to results for the year ending 30 September, the group’s underlying profits hit £147m, up from the £135m posted over the same period last year.

New buy-to-lending for the year reached £1.2bn, the results revealed.

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John Heron, the group’s director of mortgages, described the period as a “year of two halves” for buy-to-let.

He said there had been “very strong completion levels” of mortgage applications in the run-up to the stamp duty increase in April, followed by a “commensurate” reduction in activity levels across the market from April.

However, the Paragon mortgage director said the pipeline of new business is now gathering momentum, with an increase of approaching 20 per cent in October. 

“Much of this is due to the success of Paragon Bank in providing us with diversified funding allowing us to deliver a series of competitive products which is driving an increase in application volumes.”

Mr Heron also said he has seen improvements in the professional landlord segment of the market.

“While the buy-to-let market has had a challenging year, we continue to see the potential the sector has to offer. 

“With strong rental demand, there will continue to be a growing need for professional landlords to provide quality, private rental accommodation,” adding Paragon is “well-positioned” to work with these landlords.