Buy-to-let loans fell by greater than a 3rd in accordance with evaluation of the latest figures from the Financial Conduct Authority.
Conveyancing solicitors Bird & Co says mortgages to property traders dropped 37% in 2022-23.
The agency additionally discovered that buy-to-let mortgage arrears doubled to £51 million as rates of interest climbed sharply final 12 months.
Other findings embrace:
- Remortgages jumped 57% in 2022-23, the most important change within the final 5 years.
- Loans to people with poor credit score histories decreased by 4% in contrast with a 9% enhance the earlier 12 months.
- And single earnings loans witnessed a ten% lower in 2022-23.
Homeowners are turning to remortgaging to take care of monetary uncertainty, searching for higher rates of interest and extra inexpensive cost choices, Bird & Co says. This development highlights a cautious strategy amongst householders.
The lower in lending to people with impaired credit score historical past and single earnings households signifies a tightening of lending standards, pushing sure teams of individuals additional away from homeownership, the agency says.
Lagging behind
Daniel Chard, Partner at Bird & Co, says: “The concerning trend of buy-to-let advances consistently lagging behind the average raises questions about the attractiveness of property investment in current economic circumstances.
These trends could exacerbate difficulties for future borrowers.”
“The surge in remortgages suggests homeowners are cautiously tapping into the benefits of home equity, whether for debt consolidation or to invest further – and they aren’t afraid to switch lenders to get the best deal possible, given the drop in home loan advances,” he says.
“These trends could exacerbate difficulties for future borrowers, as they navigate a process where access to credit becomes increasingly selective, impacting their ability to secure loans and fulfil their property aspirations.”
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