Paragon Bank has found that the proportion of mortgage intermediaries expecting to see an increase in buy-to-let business over the next 12 months grew in the second quarter of the year.
The lender’s FACT report revealed 53% of mortgage intermediaries surveyed in the quarter expect buy-to-let business to grow over the next 12 months, despite the tapering of the Stamp Duty holiday.
This compares to 50% in the first quarter of the year, whilst the proportion expecting declining levels of buy-to-let business remained consistent at 10%.
Moray Hulme, Paragon Mortgages’ director of sales, said: “These figures suggest that the strong levels of buy-to-let business witnessed over the last six to nine months wasn’t just as a result of the Stamp Duty stimulus, but down to more fundamental shifts in where and how people want to live.
“We still expect to see business levels moderate as the Stamp Duty holiday ends but landlords are seeing plenty of opportunities to expand their portfolios to meet excellent levels of tenant demand and changes in the type of property people now want to rent. There has certainly been a growth in tenant demand for family homes, for example, and landlords are reacting accordingly.”
Brokers also reported that demand for buy-to-let was strong during the quarter itself, with 42% of intermediaries stating demand was ‘strong’ and 8% ‘very strong’. That compares to 26% in the corresponding period last year at the height of the pandemic.
Conversely, just 10% of respondents reported buy-to-let demand as weak during the period, compared with 30% during the second quarter of 2020.
Overall, broker confidence generally was high, with 91% stating that they were confident about the outlook for their business over next 12 months. This was particularly prevalent for those with high levels of buy-to-let business, with the figure hitting 97% for this cohort.
Hulme added: “Mortgage brokers have experienced a busy 12 months after the initial panic of the coronavirus pandemic. They enter the second half of 2021 in a confident, robust mood, which is indicative of the underlying demand for mortgage products.”
