The Council of Mortgage Lenders found that new lending for buy-to-let continued to decline with just 37,000 new loans in Q4 2008 worth £3.9bn – 12 per cent down on the third quarter, and 56 per cent down compared with the fourth quarter of 2007.
The CML only began collecting quarterly buy to let data in 2006, but it says on the basis of previous half-yearly data these figures are almost certainly the lowest quarterly lending figure since 2003.
Over 2008 as a whole, buy-to-let lending accounted for 10.6 per cent of the value of total gross mortgage advances, down from 12.3 per cent in 2007.
The CML says many buy-to-let borrowers will now be benefiting from significantly lower mortgage costs than when they first took out their loan. However, at the end of 2008, 2.32 per cent of buy-to-let mortgages were over 3 months in arrears without a receiver of rent in place, while a further 0.23 per cent was over three months in arrears with a receiver of rent in place.
The comparable arrears rate for the wider market, including buy-to-let was 1.88 per cent. The CML says in absolute terms, the number of buy-to-let mortgages in arrears, in possession, or with a receiver of rent in place, is not large.