Banks shut of BTL lifesupport.

geneer

Whoops. Looks like the not all that significant BTL revival has been stopped in its tracks.

<H1>Banks pull plug on the buy-to-let loans boom after a flood of applications from landlords

By Lauren Thompson


Banks have pulled the plug on dozens of cheap buy-to-let mortgages after a flood of applications from landlords.

More than 50 deals have disappeared recently at a time when investors are seeking to cash in on the strong demand for rented property.

More than 2,600 mortgages were granted a week to landlords between April and June. There are now 1.3 million outstanding buy-to-let loans – a new high.


Rentals: But the buy-to-let boom is now set to end

But this week a number of big name mortgage lenders were forced to pull their best rates.

On Wednesday, The Post Office withdrew all its buy-to-let mortgages, and Skipton Building Society has stopped offering its ultra-cheap tracker deals.


Buy-to-let specialist Kensington pulled the last deals on the market requiring only a 15 per cent deposit, and new bank Aldermore withdrew its popular fixed rate.

Landlords who missed out on these cheap deals and are hoping to cash in on the boom will now have to make bigger mortgage repayments.

For example, Skipton’s tracker rate has risen from 3.24 per cent to 3.59 per cent – the equivalent of £44 a month extra on a £150,000 interest-only mortgage.


Rates hike: Lenders such as the Skipton Building Society have ditched their best deals

Aaron Strutt, mortgage adviser with broker Trinity Financial, said: ‘Landlords have been seizing the opportunity to cash in.

‘Now many banks have simply reached the maximum amount they can lend on their cheapest, most popular mortgage deals.’

But even with rate rises, experts say landlords are unlikely to be deterred.

The property market is stagnating in many parts of the country, with just 78,000 homes sold in August – 6,000 fewer than in July, according to HM Revenue and Customs.

Meanwhile the number of first time buyers has almost halved compared with 2007, while their average deposit put down on a house has doubled from £13,222 to £26,250.

Rents are also reaching record levels, with tenants – many of whom are struggling to buy their own home – currently paying a record £713 a month on average.

Those in London are forking out £1,025 a month, according to estate agency LSL Property Services.

Katy John, spokesman for housing pressure group PricedOut, said: ‘Landlords are displacing would-be first time buyers.

‘Many young people and families are now stuck renting and home ownership is a distant dream.’

David Hollingworth, head of communications at mortgage broker London & Country, said: ‘With such a strong demand for buy-to-let mortgages, banks will need to manage how much they can lend.’

First-time buyers are four years younger on average in the North, Wales and Scotland than in London. Their average age in these areas is 28, compared with 32 in London. The national average is 29, according to Halifax.

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wotsthat

Oh no. The Skipton tracker rate has gone all the way up to 3.59% - there'll be panic selling.

GDB2222

wotsthat wrote: »

Oh no. The Skipton tracker rate has gone all the way up to 3.59% - there'll be panic selling.

If that 3% over base, it could get quite expensive if base goes up to say 4%.

wotsthat

GDB2222 wrote: »

If that 3% over base, it could get quite expensive if base goes up to say 4%.

Most tenants will have paid off their landlords mortgages before base rates go up to 4%.

Turnbull2000

wotsthat wrote: »

Most tenants will have paid off their landlords mortgages before base rates go up to 4%.

Aye, it'll be a good 10-15 years before rates hit those heights again. Meanwhile, savvy buyers and investors continue to reap the rewards.

nearlynew

Turnbull2000 wrote: »

Aye, it'll be a good 10-15 years before rates hit those heights again. Meanwhile, savvy buyers and investors continue to reap the rewards.

Does that include you or are you still living with your sister?

Turnbull2000

nearlynew wrote: »

Does that include you or are you still living with your sister?

What's with the sister obsession and this fantasy that I've lived with her all about? Do you want to meet her? Feeling a bit lonely? Please explain so I can understand your plight.

nearlynew

Turnbull2000 wrote: »

What's with the sister obsession and this fantasy that I've lived with her all about? Do you want to meet her? Feeling a bit lonely? Please explain so I can understand your plight.

It's something you mentioned on HPC a couple of years ago.


Anyway, have you bought a house?

Turnbull2000

nearlynew wrote: »

It's something you mentioned on HPC a couple of years ago.


Anyway, have you bought a house?

Really? Show me the link.

It's a shame it's not true, it would have been a fabulous money saver living with my good sister. Think I'll start suggesting house sharing with siblings to any frustrated bears.

But I gather you don't get on with your family, right? Just trying to understand your obsession.

Cleaver

I live with nearlynew's Mum.

Thrugelmir

wotsthat wrote: »

Most tenants will have paid off their landlords mortgages before base rates go up to 4%.

Most LL's have interest only mortgages..........

So living for today rather than saving for tomorrow.