- Buy-to-let mortgages declined year-on-year in the three months to December
- Pipeline of loans is growing, but that may be thanks to the stamp duty holiday which ends in March
The buy-to-let lending market is showing tentative signs of a recovery, according to Paragon Banking (PAG).
In the three months to December, the lender wrote £299m of buy-to-let mortgages. That marked a decline of more than a fifth compared with the same period in 2019, though Paragon put this down to “lagged impacts of the first lockdown” on its business pipeline and the broader difficulties in completing house sales.
The FTSE 250 constituent, which was the first major domestic lender to recommence dividends when it published full-year results last month, said that its buy-to-let pipeline had grown to £967m at the end of 2020, up £153m in a year. That suggests the backlog is yet to be cleared, though to what degree the transactional pipeline will shrink after a stamp duty holiday expires in March remains to be seen.
Take up of payment holidays also remains low, though the lender again cautioned that the full economic effects of Covid-19 remain uncertain.
