Mortgage Market News

Buy-to-let refinancing torrent boosts high mortgage predictions

Image of Buy-to-let refinancing torrent boosts high mortgage predictions.
Monday September 27, 2021

According to IMLA (Intermediary Mortgage Lenders Association), gross mortgage lending is expected to reach a whopping £285 billion this year- that is the highest level of borrowing in terms of value since 2007. Buy-to-let lending is driving a significant amount of this growth. Gross buy-to-let lending is set to increase to £40 billion in 2021 and £41 billion in 2022. The IMLA expects 2021 to outperform every other year since 2016, with £13 billion of house purchases attributed to buy-to-let lending.

While it’s true that there are lots of amateur landlords entering the buy-to-let market to capitalise on local ‘holiday boom’ happening as a result of the pandemic, the figures don’t necessarily reflect growth in new buy-to-let landlords. Instead, the figures demonstrate an increase in refinancing buy-to-let-properties, as mortgage lenders have reported to have seen a spike in refinance applications after rate cuts and landlords realised the savings available to them by refinancing.

The strong recovery in the property market has also contributed to the surge in buy-to-let refinancing, as landowners and landlords sustained confidence in real estate fundamentals has encouraged them to hold onto their property portfolio, with very few exiting the buy-to-let market.

Increased Buy-to-Let Products 

Buy-to-let mortgages were once a niche financial product, however, there has been significant growth in the number of mortgage products available to landlords, including more holidays let mortgages. Research suggests that the number of products available has almost doubled, offering landlords and developers more choice. More competition in the buy to let products typically means lower rates. Furthermore, more borrowing is now available on a fixed rates basis which provides landlords with more financial certainty, allowing them to control their costs more easily.

Emerging Buy-to-Let Hotspots: Capitalise on the Holiday Let Boom

If you have your sights set on adding a holiday let to your property portfolio, it’s crucial to invest in a bustling area destined to be a popular holiday destination for years to come. It’s particularly wise to invest in up-and-coming areas — Paul Welch, CEO of, advises developers to look to coastal towns near metropolitan areas for investment opportunities: “I expect that beachside locations will see some ‘levelling out’ over the next few years. If you have a house in Crawley, you may visit Brighton for a long weekend, and if you live in Horsham, you may be drawn to Chichester. Similarly, if you live in Essex, then you might choose to invest in Clacton-on-Sea.” Although travel abroad is now permitted, lots of people do not want the hassle of the administration associated with travel. Therefore, the UK will continue to attract domestic holiday goers and couples looking to take advantage of the hybrid working model by changing their working environment. It is prudent to invest somewhere with solid transport links, which will benefit from a stream of holidaymakers, and steady growth in local property prices and investment in the local area for years to come.

If you are a buy-to-let landlord seeking professional advice stay in contact with Call 020 7519 4900 today to get in touch with our team of specialist advisers, who are adept at navigating the buy-to-let market.

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