On average, intermediaries recorded a 3.1% increase in buy-to-let business during the quarter, which is positive news for the private rented sector. Overall, 43% of intermediaries recorded increasing buy-to-let business levels, compared to 7% who said business levels fell.
Of those reporting an increase in business, 12% said business levels rose by more than 10%, with 13% stating business was up between 6% and 10%. Half of intermediaries said buy-to-let business levels remained unchanged during the period.
The research also showed that buy-to-let mortgages accounted for 24.3% of the total mortgages processed by intermediaries in Q3, which has increased from 20% three months ago and is the highest proportion since Paragon started asking the question in the first quarter of 2007. Residential owner-occupied mortgage business accounted for 66.6% of applications, down from 72.2% in the second quarter, which was the lowest level since Paragon started collating the data.
Elsewhere, intermediaries reported an improvement in the availability of buy-to-let finance, with 58% of respondents saying they believed buy-to-let mortgages were more readily available, and 31% saying that it had stayed the same.
John Heron, Managing Director of Paragon Mortgages, said: "It is positive to see that buy-to-let accounted for a growing percentage of intermediaries’ overall business levels during the third quarter. Given the pressures on the private rented sector, it is important that landlords continue to be active purchasers and develop their portfolios.
"Buy-to-let is an important source of business for mortgage intermediaries, but far too many products are now of the "me-too" variety. Professional landlords play a pivotal role in the PRS, with just 11% of landlords owning 73% of the property according to Government statistics. There are plenty of opportunities for intermediaries to develop further business in this market but more needs to be done to deliver products and advice to larger scale investors. Cultivating a relationship with professional landlords can generate repeat business for intermediaries as well as ancillary sales."
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