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Buy-to-let mortgages increase in 2007

18 January 2008 / by None
Falling house prices were responsible for an increase in buy-to-let mortgages in 2007, according to property consultants Hamptons.

Figures show that 39.55 per cent of all mortgages arranged through the consultants were for buy-to-let purposes, representing a significant increase from 17.9 per cent in December 2006, Citywire report.

However, loans for house purchase fell from 35.94 per cent to 13.18 per cent in December 2007.

This is indicative of falling house prices representing investment opportunities for landlords, but being potential negative equity for homeowners, says Citywire.

Jonathan Cornell, managing director at Hamptons International Mortgages, commented: "This year review of 2007 mortgage trends highlights a clear swap in popularity between residential and buy-to-let mortgages."

He predicted that 2008 would see an increase in applications for tracker mortgages as people attempt to benefit from a base rate decline.

Official government figures have shown that the average cost of a house fell by £1,750 in November.

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