Number of buy-to-let deals on the rise
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The number of available buy-to-let deals has increased 34% since September, but landlords still require a deposit of 25% to have any product choice.
Figures from Moneyfacts.co.uk show that the number of buy-to-let deals has risen from September’s low of 179 products to 239 products available today.
But the number of buy-to-let products compares poorly compared to the market peak of August 2007, when 3,662 buy-to-let products were on offer.
Moneyfacts.co.uk says the buy-to-let sector has seen 93% of buy-to-let deals disappear in the last two years.
Currently only Clydesdale and Yorkshire Bank offer deals for landlords with a 20% deposit.
Michelle Slade, spokeswoman for Moneyfacts.co.uk, says: “Many landlords’ biggest problem in securing a competitive deal will be finding the deposit needed as previous house price falls are likely to have eaten into the equity available in their portfolio.
“At least a 25% deposit is needed, but in the residential market a 40% deposit is needed to secure a good deal.
“BTL lenders have continued to tighten criteria, restricting the size of portfolios that landlords can have, both in number of properties and maximum total advance.”
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Readers' comments (1)
Anonymous | 16 Nov 2009 1:16 pm
The lenders are not restriting the number of BTL's or maximum amount a landlord can owe - they are restricting what they will lend to an individual landlord. Landlords can borrow from a number of lenders thus spreading their mortgages - and the risk - around the market.
A BTL mortgage with a 25% deposit is not unreasonable, particularly considering the low rate of returns being achieved on rental. BTL lending criteria was too easy and some revision of criteria was necessary.
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