www.MONEYGATE.CO.UK PREDICT BOOM NOT BUST IN BUY-TO-LET MARKET Monday 5 November 2007 PDF Print The global credit crunch will spell boom not bust for the UK’s buy-to-let market as potential house buyers carry-on renting, say mortgage brokers Moneygate. Mortgage lenders are increasingly tightening their lending terms, which has seen mortgage application rejections rocket by 60* per cent in the past six months, leaving disappointed buyers being forced to stay put. Meanwhile thousands of would-be home buyers are sitting it out in the rented sector, while they wait to see how the market pans out. Latest Bank of England figures bear this out, with the number of new mortgages given to housebuyers in September slumping by 20 per cent compared to the same month last year. But financial brokers Moneygate (www.moneygate.co.uk) say lenders are keeping the faith with buy-to-let property owners who represent a lower risk and therefore can still enjoy easy access to cash. Dennis Reed said: “In general the rate of arrears and repossessions for BTL investors is much lower than for residential on account of the income they can generate. “Also experienced portfolio landlords tend to be older and have greater income as well as an asset-base, which the average residential buyer does not. “Although rents have not kept pace with rising interest rates in the past 18 months there is strong evidence that private sector rents have risen sharply in the past 9 months and the rising trend is set to continue as nervous potential buyers rent properties while they wait to see what happens" “Despite predictions of doom and gloom in the property market, the buy-to-let market looks set to continue bucking the trend with predictions of up to 15 per cent growth over the next year.” Worth £104bn in lending, the buy-to-let market now represents 10% of all mortgages and 12 per cent of new ones; this figure is confidently expected to exceed 15% in the first half of 2008. In the UK 12% of landlords own 75% of Private Rental stock with the average age of the portfolio owner 49. * More than 738,000 home loans were turned down by mortgage firms since March, as banks and building societies enforce stricter lending conditions, according to research by analysts MoneyExpert.com. In the six months to March 2007, figures show that around 463,000 people had a mortgage application rejected. This figure has since risen to 738,000 in the six months to October as Bank of England interest rate rises hit borrowers. -ENDS- For further information please contact Andy Barker at Results Network on 0191 519 7268 or 07855 352 303. This press release was distributed by ResponseSource Press Release Wire on behalf of Results Network PR in the following categories: Personal Finance, Business & Finance, for more information visit http://pressreleasewire.responsesource.com/about.