Mortgage Lending Becoming Static
The latest figures show that the amount of money being borrowed for mortgages has remained at the same level as the month previous. Despite the slowing housing market there does seem to be a diversification going on though.
Mortgage lending has dropped over the year, partly due to a tightening of the lending criteria, partly due to interest rate increases. July showed that mortgage lending was at £34.1 billion whilst August was just a little below at £34 billion. However the Buy-to-Let lending has shown a steady increase throughout the problems.
So why would the buy-to-let market still be going strong? The main reason is due to the possible worry of property prices falling. People are now very wary about buying a house and are sticking to renting. This in turn is providing a greater opportunity to target this particular area with a buy-to-let mortgage. With a bigger rental market, the chance of making a return on your rental property is stronger.
Unfortunately it only seems to be those who already are on the property ladder that can afford to continue buying property at this time and this makes it harder for first-time buyers to make their mark on the property ladder.
Reports at the moment have not included the progress of things since last months Northern Rock crisis. More may be revealed when this information is compiled and released and may show a slowing down in the buy-to-let market too.
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