Buy-to-let loans accounted for 6.4% of gross lending during the period, a slightly higher share than in the second half of 2002 (5.5%).
The continuing growth of buy-to-let (71,300 loans worth £6.7 billion were advanced in the second half of 2002) means that there are now 334,800 mortgages outstanding in the sector, worth £31.2 billion or 4.3% of the mortgage market overall.
The average value of a buy-to-let loan increased from £94,000 to £102,500 in the last six months. Remortgaging in the sector was also buoyant, accounting for 39% of gross advances in the latest period.
Buy-to-let lending quality remains good. Lenders have maintained an average maximum loan-to-value ratio of 80% for two years and the average minimum rental cover - the proportion of the mortgage payment that lenders require the rent to cover - has remained unchanged at 130% since the CML began collecting data in 1998. There has been a small increase (from 0.42% to 0.45%) in the number of buy-to-let mortgages more than three months in arrears, but this proportion is less than half the figure for the mortgage market as a whole.
Commenting on the latest figures, the CML's Director General Michael Coogan said:
"Although there has been a recent improvement in stock market performance, it is not surprising that many people still see property as a safer haven. But spreading risk is also important, and it is rarely good advice to put all your eggs in one basket - even if it has all the traditionally solid qualities of bricks and mortar. As part of a balanced investment strategy, and for those looking beyond short-term speculation, buy-to-let continues to offer attractive opportunities."
