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Buy to let borrowing soars to post crash peak

23 February 2016

Buy to let borrowing hit a post-downturn peak in 2015 as investors bundled more cash into the sector.

Buy to let lending was up 28% compared to the year before, according to trade body the Council of Mortgage Lenders, which is the voice of all the UK’s property investment lenders.

The amount advanced also increased by 35% year-on-year.
But the total advanced was £37.5 billion – which is way behind peak buy to let borrowing of £43.7 billion in 2007 and matching the £38 billion lent in 2006.

The 2015 borrowing is split £21.9 billion in favour of remortgaging against £15.6 billion for buying new homes to rent.

Paul Smee, director general of the CML, said: “Improving economic conditions, boosted by government schemes like Help to Buy, saw the highest quarterly number of loans to purchase a home for eight years.

“The market has seen a gradual upward trajectory over the past few years, rather than rapid growth, and we'd expect this trend to continue with gross lending steadily increasing over the next two years.”

Lending dropped back by 1% in volume and value in the last three months of 2015, but the CML explained this was not unexpected in the festive season.

Read more commentary and data from the CML here

UK Mortgage Gross Lending 2007 - 2015



 
Home-owner house purchase (in £millions)
 

Buy-to-let (in £millions)

 
  First-time buyers
Movers
Remortgages
Purchase
Remortgages
2015 46,700 72,100 55,000 15,600 21,900
2014 45,000 67,700 45,900 12,400 14,500
2013 36,100 58,100 45,100 9,300 10,700
2012 27,500 53,900 41,400 7,400 7,600
2011 23,800 51,700 46,700 6,200 6,400
2010 24,100 54,700 39,600 4,650 3,960
2009 22,000 47,300 51,800 4,530 3,390
2008 23,900 51,800 118,400 12,210 14,610
2007 47,200 107,500 129,200 23,100 20,640
Source: CML Regulated Mortgage Survey