The number of mortgages approved for buy-to-let acquisitions fell in April, according to the latest figures, which suggest that many landlords are being deterred from the market by the phased removal of mortgage tax relief.

Government measures designed to reduce growth in the buy-to-let sector, such as the 3% stamp duty surcharge on buy-to-let and second homes introduced in April 2016, and cuts to tax relief on mortgage interest, which are being phased in over four years from April 1 2017, have hit smaller investors in particular.

The data published yesterday by the Council of Mortgage Lenders (CML) showed a 16% fall in buy-to-let lending between March and April, while the value of lending in the sector was 16% lower month-on-month.

In contrast, first-time buyers are taking advantage of competitive rates, as reflected by the 25,400 loans secured by this group in April, which were collectively worth £4.1bn, down 16% on March but up 8% on April 2016.

Alastair McKee, managing director of One 77 Mortgages, said: “The market is less lopsided than one-sided. Against a backdrop of cheap loans, Help to Buy and significantly reduced competition from landlords, first-time buyers are having a field day.

“With many landlords still reeling from the raft of tax and stress-testing changes, first-time buyers see an opportunity and are taking it.”