Investors are reacting to news of a housing recovery by pouring more and more money into the private rented sector - 40,000 buy-to-let mortgages were advanced in the second quarter, according to the Council of Mortgage Lenders, 19 per cent more than in both the first quarter of this year and the same quarter of last year. In value terms, the increases are even more dramatic, reflecting house price inflation over the past year.
The recovery is accelerating, but the buy-to-let market is nonetheless less than half its size at the height of the previous boom. Lenders made 171,800 loans to landlords in the first half of 2007, but only 73,500 in the first half of 2013.
Remortgaging grew more strongly than lending for house purchases in the second quarter, as interest rates on new loans fell below those on existing tracker mortgages for the first time. Buy-to-let lending as a proportion of the total also continues to climb, hitting 13.3 per cent of all loans outstanding. That's despite record lending to first-time buyers, who took out a total of 68,200 loans in the second quarter - the highest since 2007.
