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Lenders deny boom is over for BTL

Lenders are hitting back at warnings from analysts and estate agents that the buy-to-let boom will soon be over.

Specialist lenders The Mortgage Business and Future Mortgages dispute claims that buy-to-let is set to decline because of slowing rental demand, a poss-ible increase in interest rates and a recovering equities market.

TMB argues that, contrary to concerns that people are borrowing more than they can afford, it has figures to show that investors are being prudent.

Of its buy-to-let completions in the last year, 52 per cent of borrowers had deposits of 25 per cent, despite a maximum loan to value of 85 per cent.

TMB says 60 per cent of its clients are experienced investors with portfolios consisting of several properties, which contradicts the view that the recent boom is due to new entrants testing the water.

Managing director Bill Dudgeon says: “While some concerns are justified, we can show categorically that our borrowers are prudent. We have always taken the stance that buy-to-let is a long-term investment.”

Future Mortgages head of PR Richard Hurst says: “There are big fears about the buy-to-let market, backed up with little evidence. It is set to keep growing because of factors like first-time buyers finding it hard to get on the property market and staying longer in rented accommodation.”

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