The number of properties bought with buy-to-let mortgages increased by 84,000 and lending levels improved for the second year in a row – with the value of lending up 40% at £14.1bn and volumes up 32% with 124,000 loans originated.
While this is positive news we should not believe a buy-to-let boom is just around the corner as lending volumes are barely a third of what we saw at their peak.
The point to note is that, unlike other sectors, buy-to-let is making steady progress. This is because landlords are keen to extend their portfolios in the face of record tenant demand and because lenders are expanding their buy-to-let propositions.
Despite the rise in buy-to-let lending the signs are that tenant demand continues to outstrip the supply of rented property and more competition and innovation will be necessary if we are to see the market return to any equilibrium.
According to our recent broker survey, just over half – 53% – expect to complete more buy-to-let business this year. Of those, 19% said they expect a rise of 10% or more, which gives a good indication of the mood of the wider industry.
The CML figures are encouraging but it isn’t time to rest on our laurels. We must continue to work hard, develop new products and keep building a positive future for the industry.