A report from Paragon states that over half of all buy-to-let business consists of remortgage transactions.
The figure comes from Paragon’s latest Financial Adviser Confidence Tracking Index, which compiles the thoughts of 200 mortgage intermediaries across the UK. It reveals that, in Q3, remortgaging took up 57 per cent of BTL action, up from 49 per cent in the previous quarter. This, says Paragon, is an all-time high.
The report also states that first-time landlord business dropped from 14 per cent to 10 per cent of business over the quarter, with landlords seeking funding for portfolio expansion also dropping over the same time frame, from 23 per cent to 19 per cent.
Paragon managing director of mortgages John Heron says: “Landlords are investing less in the private rented sector… this is clearly a response to the increase in costs that landlords face following changes to stamp duty and tax relief on finance costs.
“It’s no surprise therefore to see that landlords are taking the opportunity to reduce their mortgage finance costs as one part of their strategy to mitigate the impact of higher taxation. Tax bills due in January 2019 will include the first phase impact from the withdrawal of mortgage interest tax relief and landlords are preparing carefully for the next stages ahead.”