As many potential first time home buyers are being forced into the rental market along with homeowners that can no longer afford to keep their homes and those in the buy to let market have been rejoicing as rents continue to rise and their properties experience a competitive amount of inquiries.
In fact, due to the high deposits attached to most of the best mortgage deals and the tight lending criteria many people who previously would have purchased a home are now forced into renting an apartment or home instead.
Due to this fact many landlords are remortgaging their properties even as homeowners have stopped as the forecast has lightened up on the Bank of England threat of an interest rate increase.
This is due to the fact that smart landlords are realising that if they remortgage right now and take advantage of the low buy to let mortgage rates they will be able to afford more homes to add to their lending portfolio allowing them to take better advantage of the current renting situation in the UK.
In fact, a Paragon Mortgages survey conducted within the month stated that the number one reason that most landlords are deciding to remortgage their property is to raise capital. Managing Director for Paragon Mortgages, John Heron, stated that about two thirds of the private rental properties do not have a mortgage on them while the average LTV on the properties that do have a mortgage attached to them sits at about 48%.
Therefore, there is a large amount of equity available to those that want to build their portfolios as landlords and with the excellent buy to let mortgage rates savvy investors are realising that the time to move is now.
Heron went on to say that figures from the Council of Mortgage Lenders display that there has been a large increase in the amount of people remortgaging their buy to let terms during the first and second quarters of 2012 and it would seem that many of the mortgage cases come from landlords that have used their equity in order to continue to expand their portfolios. He added that as the market becomes more rental based than home based it is quite likely that this practice will become more common place.