Nationwide group distribution director Matthew Wyles has dismissed claims that increased buy-to-let activity is edging first-time buyers out of the owner-occupier market.
Speaking on a panel of mortgage lenders at the Sesame symposium, he said FTBs are re-strained by strict lending criteria and an inability to raise a deposit.
He said: “Some commentators have blamed first-time buyers’ inability to buy on buy-to-let investors. That is baloney. Property prices are not rising but rental values are, as demand for rental property outstrips that for owner-occupation. First-time buyers are reluctant to get into the market because of issues over criteria and the amount of equity needed to put down.”
Figures from the Council of Mortgage Lenders show BTL advances totalled £9.7bn in 2010, compared with £8.1bn in 2009. At the end of the third quarter of 2011, there has already been £9.7bn advanced.
Lloyds Banking Group sales director of mortgages Mike Jones predicted the BTL sector will grow by 20 per cent over the next year, meaning the sector could potentially reach up to £15bn in 2012.
Jones said: “We do not see the BTL and FTB markets crowding each other out. We do see healthy growth in BTL and there will be a 20 per cent bigger market next year.”