Buy-to-Let continues to grow as rents reach record-highs
Buy-to-Let mortgages were granted to 40% more borrowers in August, according to data released by the Council of Mortgage Lenders (CML).
When compared to the same period of last year, a total of 22,200 buy-to-let mortgages were arranged in August 2015, with a total value of £3.4bn.
The large increase is far greater than the rise seen in home-mover mortgages (8%) but buy-to-let lending still only represents 17% of the entire market.
One of the reasons for the jump in buy-to-let lending could be down to the new pension freedoms that were introduced in April earlier this year. The newly-reformed pension rules allow people over the age of 55 to have more flexibility with how and when they withdraw their funds, and many have chosen buy-to-let as a worthwhile investment.
Rental demand is currently high and average monthly rents hit record levels across the country this year. These higher rents, when combined with the growth in house prices, mean that landlords have seen a 0.5% increase in their returns in the same time.