There has been a sharp rise in demand for buy-to-let mortgages after a number of two-year fixed deals came to end.
A number of landlords obtained mortgages in March 2016, looking to avoid the 3% stamp duty surcharge being introduced for new buy-to-let and second home acquisitions a month later.
Many buy-to-let landlords with two-year deals that recently ended have switched to other deals by refinancing, rather than allow themselves to automatically be transferred on to the standard variable rate set by their lenders, which tends to be significantly more expensive.
Remortgaging has contributed to the hike in buy-to-let deals secured in recent weeks.
“As far as buy-to-let mortgages go, there has been significantly more demand than at this point last year with a raft of two-year fixed deals reaching maturity following the stamp duty rush of 2016,” said John Goodall, CEO of buy-to-let specialist Landbay.
Despite the pick-up in buy-to-let mortgage lending, overall mortgage activity in March was down 2.3% on last year, industry figures showed yesterday.
Banks approved 37,567 mortgages for residential property purchases last month, down from 38,035 in February and 10% less than in March 2017, according to UK Finance.
Eric Leenders, managing director for personal finance at UK Finance, commented: “There was a rising trend in mortgage approvals for the first three months of 2018 although the number is slightly lower than the same period in 2017.”