This results in making up 12% compared with last months 8% seeking buy to let mortgages from Mortgages Direct.
The index also reveals that first time buyers continue to show reluctance to enter the market as the number seeking mortgages has decreased by 6% in September, making up 38% of Mortgages Direct’s loans in September.
Peter Gladdy, Director of Mortgages Direct comments; “The renting market is fairly buoyant in this current climate, with many potential homeowners sitting on their hands, waiting to see which way the prices will go and therefore opting to rent instead. Landlords are responding proactively to the demand and to the upward trend of rents. The established investor, who takes a long term, professional approach to buy-to-let, continues to buy selectively and carefully.”
Peter Gladdy continues; “Also the imminent changes to SIPPs, where residential property will soon become a valid SIPP investment is already boosting the number of buy to let mortgages, as investors are realising the opportunities to boost their pension funds.”
Despite the recent drop in interest rate levels to 4.5% consumers are clearly showing little confidence that they will remain low. An increasing number of borrowers are now becoming a lot more cautious and are opting for fixed rate deals. Tracker mortgages have decreased from 10% to 4% since last month.
Despite the recent decrease in interest rates the number of borrowers opting for interest only repayments has increased to 31% from 19% last month.
Peter Gladdy comments “It is surprising that more borrowers are opting for interest only repayments. This is not advisable and borrowers need to ensure that a comprehensive repayment method is in place. Borrowers are evidently still feeling the squeeze on their finances.”
