As growth in the UK property market continues to confound expectations, the range of mortgages available to people has also expanded. First time buyers, for instance, look for different benefits from a mortgage than they did ten years ago. Similarly, there are more people requiring different types of mortgages, like bad credit mortgages and divorce mortgages.
One type of mortgage that is on the up is the buy-to-let mortgage, which allows property owners to purchase a second property with the intention of renting it out to tenants. In fact, buy-to-let mortgages can be an excellent way to make money, if you find the right deal to meet your specific needs. A recent article in the Guardian newspaper claimed that buy-to-let mortgages had increased by 48% in 2006, with banks, building societies and other lenders dealing out 330,000 buy-to-let mortgages worth a total of £38.4 billion.
According to the Council of Mortgage Lenders (CML), the number represents not only a 48% rise in volume but a 57% increase in value since 2005. The total number of buy-to-let mortgages in the UK is now said to stand at a total of £94.8 billion, with buy-to-let mortgage lending representing 9% of the value of all mortgage balances in the country.
According to the CML, the number of landlords falling into arrears also continued to decrease in 2006, with the proportion of buy-to-let mortgages that were three or more months in arrears dropping from 0.64% in June 2006 to 0.59% by the end of the year. What's more, this figure is lower than the 0.89% of loans in arrears in the UK mortgage market as a whole.
Even more encouraging is the low repossession rate of buy-to-let properties. In 2006, lenders repossessed 1142 buy-to-let properties; this represents 0.14% of all landlord mortgages, a figure lower than the 0.15% repossession rate in the entire mortgage market.
Michael Coogan, director of the CML, told the Guardian: "The buy-to-let market has performed even more strongly than the wider market over the course of 2006. With evidence from other sources of strong tenant demand, rising rents and falling void periods, buy-to-let looks set to continue to remain popular and successful."
If you're looking for a buy-to-let mortgage, investigate carefully and you'll find a range of banks, building societies and other financial institutions offering great deals on buy-to-let mortgages to meet your needs. And with the current buoyancy of the buy-to-let mortgage market, an investment of this kind is sure to reap untold benefits!
