Nationwide group distribution director Matthew Wyles (pictured) has rubbished claims that increased buy-to-let activity is edging first-time buyers out of the owner occupied market.
Speaking on a panel of mortgage lenders at the Sesame Symposium in London earlier this week, Wyles said first-time buyers are instead restrained by strict lending criteria and an inability to raise a sufficient deposit.
He said: “Quite unfairly some commentators have blamed first-time buyers’ inability to buy on buy-to-let investors. I think that is just utter, unadulterated baloney for a number of reasons. Property prices are not rising and yet rental values are, so that clearly indicates that there is a demand for rental property that is outstripping the demand for owner occupation.
“It is a complex algorithm but first-time buyers are reluctant to get into the market because of issues around criteria and the amount of equity people need to put down.”
According to figures from the Council of Mortgages Lenders, buy-to-let advances totalled £9.7bn in 2010, compared to £8.1bn in 2009. At the end of the third quarter of 2011, there has already been £9.7bn advanced to customers.
Lloyds Banking Group sales director of mortgages Mike Jones predicted the buy-to-let sector will grow by 20 per cent over the next year, meaning the buy-to-let sector could potentially reach up to £15bn in 2012.
Jones said: “We do not see the buy-to-let market and the first-time buyer markets crowding each other out. We do see healthy growth in buy-to-let and we see a 20 per cent bigger market next year.”