In the process they borrowed £15,000 more, with typical loan sizes reaching £185,188, and deposits rose by nearly £20,000 to £125,016 in 2016.
Landlords typically paid £310,265 for an investment property in 2016, £35,000 more than £275,286 in 2015, research from The Mortgage Broker shows.
In the process they borrowed £15,000 more, with typical loan sizes reaching £185,188, and deposits rose by nearly £20,000 to £125,016 in 2016.
Darren Pescod, managing director of The Mortgage Broker, said: “Landlords are certainly feeling the pinch, but the raft of tax changes that came into force in 2016, do not appear to have dampened the buy-to-let market.
“In many towns and cities, landlords have increased their investment in buy-to-let property, despite the financial challenges that have been recently thrown at them by the government.
“Our research shows that landlords are finding larger deposits and increasing their borrowing to secure property. With mortgage interest rates so low and the demand for rental property booming, the market still provides a great investment opportunity.”
According to the Council of Mortgage Lenders (CML), gross buy-to-let lending in November was the highest since the stamp duty changes on second properties were introduced last April.
Landlords borrowed £3.2bn in November 2016, up 10% month-on-month but down 9% year-on-year.
Pescot expects larger landlords to become the norm and smaller ones to pull out of the market.
He added: “Though the stamp duty additional levy and income tax changes that come into force in this tax year have slowed down this sector it terms of the number of applicants applying for new buy-to let mortgages.
“This may lead to some consolidation with larger landlords, scooping up rental opportunities in their local area and beyond.
“Our view is that smaller landlords with fewer than three properties may find it financially tough and will pull out of the market.”
