Buy-to-let market 'stifled by lack of cheap mortgages'

A shortage of buy-to-let mortgage finance is preventing landlords from expanding their property portfolios, it has been claimed.

According to Vincenzo Rampulla, public affairs officer at the National Landlords Association NLA, few will be able to make the most of low interest rates and increased tenant demand unless "lenders release their purse strings".

Just 12 per cent of landlords intend to purchase more properties in the coming months, despite 36 per cent expecting tenant demand to increase within the next year, reports Paragon Mortgages shows.

Mr Rampulla stated: "Given the difficulty with obtaining buy-to-let mortgage finance it is of little surprise so few landlords are looking to expand their portfolios."

He added that tenant demand for properties is already increasing due to accidental landlords leaving the rental market and placing their homes up for sale.

Last month, the Association of Residential Letting Agents reported that 58 per cent of survey respondents felt the insufficient supply of rental stock is the biggest issue facing the sector.

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2010-04-16 13:05:00 © Moneyextra.com