Virgin Money reined in buy-to-let
In the wake of the release of Virgin’s Q3 2015 results, which revealed that the bank upped its gross lending by 38% year-on-year, she admitted Virgin acted to curb a market which made up 28% of its total new mortgage lending earlier in the year.
Gadhia said: “We have pulled back a little bit on buy-to-let… because we don’t want to get overheated there.”
To slow down its new buy-to-let lending the bank adjusted its pricing on new business, as Richard Hemsley, Virgin Money’s chief banking officer, said buy-to-let went from representing 28% of total new mortgage lending earlier in the year to 20-23% “more recently”.
As a percentage of Virgin’s mortgage stock buy-to-let makes up 17%, which Gadhia said is in line with the rest of the market.
Buy-to-let has come under increased scrutiny over the past few months, as three weeks ago the Bank of England released a statement saying “buy-to-let mortgage lending has the potential to amplify the housing and credit cycles”.