BTL Mortgages Continue to Decline

According to the recent data, revealed by the Council of Mortgage Lenders, the number of buy to let loans in the UK continues to decline. In fact, the number of buy to let mortgages amounts to a mere 6% of all approved mortgages across the United Kingdom. This figure represents a dramatic decline compared to spring on 2008, when the proportion stood at 12%. The CML data suggests that despite the fact that the UK property market is showing some signs of recovery, the total revival of the industry will take a long time as a group of the most important players – residential landlords – are unable to expand their portfolios by purchasing property due to scarce buy to let lending. According to the revealed figures, in the first quarter of 2009 British lenders provided buy to let landlords with 22,400 mortgages, which represents a significant decline from 38,000 in the fourth quarter of 2008 and from 72,400 in the first quarter of 2008. According to the estimates, UK landlords now hold an average of 1,155,200 buy to let mortgages, which is still lower than in the previous year. The Council of Mortgage Lenders report also revealed that the number of mortgage arrears among landlords with outstanding mortgages is growing. The figures show that 3.09% of landlords are in arrears of at least 3 months, which represents a 2.31% increase from the level of 2008. Finally, the report showed that despite the increase in the number of arrears, the level of property repossessions has risen very insignificantly, which means that lenders willingly negotiate with landlords in order to come to a solution that would benefit both parties.