2011 ends with increase in buy-to-let market

The end of 2011 saw an increase in the number of people who were looking to take on buy-to-let mortgages across the UK, as the rental market proved to be resilient in terms of the UK property market.

According to the latest released figures from Paragon, more than a third of mortgage intermediaries saw a jump in the number of people who were looking to increase their portfolio or come into the buy-to-let market as a new landlord, with the number of mortgage requests rising in the final three months of 2011.

The survey conducted by Paragon also showed that the private rental sector has grown over the course of the last year. In the three months to December 2010, it reported that 19.3 per cent of intermediaries' business, on average, was made up of buy-to-let mortgages. However, in the same quarter a year later, this had grown to 23.3 per cent, a significant increase,

Paragon also said that, of those taking out mortgages for this purpose on rental homes throughout the course of 2011, four in ten were taking them out for the purpose of expanding their lending portfolios. A further three in ten were doing so because of the favourable lending conditions, which allow them to remortgage.

The number of first-time landlords in the private rental sector in 2011 grew to 23 per cent, from 19 per cent the previous year.

John Heron, managing director of Paragon Mortgages, said: "The final quarter of 2011 was for many intermediaries a successful one, with increased optimism about the coming months and a steady improvement in the level of buy-to-let business being written. With record levels of rental demand being reported it is good to see that existing landlords are increasing the size of their portfolios but it is particularly notable that the proportion of new landlords is also increasing."

Countrywide reported earlier this month that there had been 275,000 people looking to rent properties in the private rental sector in 2011.