Buoyant Buy-To-Let Market

The latest industry figures show that buy-to-let borrowing reached record highs in the first half of the year.

Lenders advanced a staggering 152,500 loans worth some £17.5 billion, according to research by the Council of Mortgage Lenders (CML).

The strong growth of borrowing has contrasted with a slower increase in lending in the wider market.

The residential investment mortgage market now accounts for eight per cent of the value of outstanding UK lending, compared with seven per cent in first half of 2005.

"The buy-to-let market remains robust, underpinned by strong rental demand," said CML director general Michael Coogan.

"But investors have shown that they are quick to adjust to changing market conditions, so the view that interest rates are now more firmly on an upward trend is likely to cause the rapid growth of buy-to-let investment to slow in the coming months.

"Fundamentally, however, the rental market remains sound and looks set to continue to offer good long-term prospects for astute investors."