Buy-to-let outpacing residential growth

Robyn Hall

April 28, 2015

Total lending for the quarter stood at £36.2bn, a year-on-year increase of 5.4%. The average value of each mortgage was £177,060 for residential (Q1 2014: £170,730) and £151,033 for buy-to-let (Q1 2014: £145,017).

Iain Hill, Relationship Manager, Equifax Touchstone, said: “In March we saw lending power ahead and the sluggish trend witnessed at the end of last year has been reversed. There have been lingering doubts over the market recovery and it is encouraging to see such positive growth.

“While traditional savings accounts continue to offer low returns, savers are looking for alternative ways to invest their money, prompting substantial growth in the buy-to-let market. An oversupply of people and an undersupply of homes makes buy-to-let an attractive proposition and we expect this trend to continue to gather pace over the coming months.”

Equifax Touchstone data, which covers 92% of the intermediated lending market, reveals that March was the top sales month for mortgage brokers in eight years. Lending was up 24.3% on February 2015, reaching £15bn. The market saw UK wide improvement with only two postcode areas, Perth and the Western Isles, reporting negative growth during the period.

Despite growing lending levels, the number of active brokers in the market has fallen in the last 12 months, down from 8,288 in Q1 2014 to 8,028 in Q1 2015. This market consolidation makes it even more important for mortgage providers to identify which networks and firms are leading the charge and successfully responding to the rapidly changing mortgage landscape and the requirements of the Mortgage Market Review.

Equifax Touchstone utilises intermediary and customer profiling tools to provide financial services providers with a detailed understanding of their marketplace and client base.

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