During the fourth quarter of 2011, a total of 34,800 buy-to-let mortgages (of which 15,600 were remortgages) were advanced, with a total value of £4 billion, according to the CML.
This was virtually identical to the volume of business in the third quarter (34,300 loans worth £4 billion) but up on the fourth quarter of 2010 (26,300 loans worth £2.9 billion).
The CML said that compared with the height of the market in the third quarter of 2007 when quarterly lending totalled over 93,000 loans worth £12.7 billion, the buy-to-let market continued to operate at relatively subdued levels. But it is clearly continuing to recover from its low point in 2009.
Buy-to-let mortgages account for nearly 13% of the total outstanding value of mortgages in the UK, and buy-to-let lending represented nearly 11% of total gross mortgage lending in the fourth quarter of 2011.
Commenting on the latest data CML director general, Paul Smee, said: "Buy-to-let lending continues to perform well. Demand for rented property remains high so the rationale for buy-to-let remains strong and there is little reason to foresee any change to this positive outlook for the sector.
"These figures do not suggest that buy-to-let is crowding out first-time buyers; more that it is performing a really important role within the overall housing market.
"The benefits of the availability of good quality, private rented housing should not be overlooked, especially as there are many households which need the flexibility and mobility that the private rented sector is well placed to provide."
Connells Survey and Valuation said the number of valuations for property investors looking to expand their portfolios increased by one fifth (21%) year on year in January 2012, despite a monthly dip of 11%.
Commenting, John Bagshaw, corporate services director of Connells, said: “The buy-to-let market’s annual growth continued in January, as returning and first-time investors were enticed to the sector by an attractive combination of high yields and broadening options for mortgage finance.
“While the government scheme’s mortgage indemnity is likely to help overall transaction levels in 2012, there will still be excess demand from frustrated buyers, and an expanding private rented sector will help underpin growth in the valuation market in the long-term.”
Jonathan Samuels, CEO of Dragonfly Property Finance, said: "Buy-to-let is nowhere near the giddy heights of 2007 but these latest figures confirm that it's on its way back.
"The buy-to-let sector is one of the few beneficiaries of the current economic climate.
"Buy-to-let is being driven by the weakness of the economy and the continued caution of high street lenders at higher LTVs.
"Consumers are wary about buying and lenders are wary about lending. The result is soaring demand for rental property, which is pushing yields ever higher.
"Landlords are making hay while the sun shines, adding to their portfolios in order to increase their exposure. The fact that property prices are low is contributing to this trend.
"Landlords can buy low and rent high, which is manna from heaven."
