The latest data released by the Council of Mortgage Lenders shows that lending for property purchasing has increased substantially. A detailed breakdown of the figures shows that a total of £4.6 billion was allocated to first time buyers this year. This reflects an increase of 10% on September and October last year and a total of 29,000 loans.
First-time buyers are continuing to pay low levels of their monthly household income towards their mortgage as a result of competitive rates. UK home movers took out 34,500 loans, which reflects a 9% increase month on month and a 3% increase from October last year. There was also a rise in homeowner remortgaging activity, with a 6% increase in volume and a 10% rise in value compared to the previous September. Gross buy-to-let saw month on month increases up 4% by volume and 3% by value.
The markets took time to gain momentum after a slow start to 2015, but both buy-to-let and homeowner activity are continuing the upward trend seen in previous months. Both sectors are sure to finish the year in strong positions. Employment is on the increase, and the UK is seeing a significant absence of inflationary pressure which indicates a continued drive in demand within the housing market.
The increase in buy to let lending is partly due to the fact that landlords can depend on the highly competitive rates available on the market to drive down their monthly expenses. The rise in buy-to-let landlords borrowing money means an increase in available accommodation for a growing nation of renters. Landlords are providing society with an important service, and the increase in available funding facilitates a greater number of suitable homes for tenants.
HMOs are becoming increasingly popular as they provide convenient accommodation for people living and working in the capital and they help landlords maximise their potential income. As a rental model, they make efficient use of properties and offer affordable and social living environments. 2016 is set to see some changes to landlord’s tax relief, but an HMO is well equipped to withstand any higher costs that may be implemented.
We can assist with management for all kinds of investment properties throughout Haringey and the rest of London, and no matter what occurs in the property market in the New Year, we will be there to help our clients through it. We offer a wide variety of services to buy-to-let landlords, including pre-auction services, and can help you to transform existing properties into lucrative HMO business models.