Buy-to-let landlords chose to re-mortgage, not purchase

Landlords are increasingly choosing to re-mortgage their existing properties instead of seeking to take out buy-to-let mortgages on new property purchases, according to new research.

According to a study undertaken by Hamptons International, the proportion of buy-to-let mortgages on purchases fell by nearly 26 per cent between October and November 2007.

Over the same period, the research revealed that the number of buy-to-let re-mortgages increased by 6.2 per cent.

In the wake of the report, the authors of the research claimed that their findings proved that landlords' confidence in expanding their portfolio had been hit by the credit crunch.

"While buy-to-let remains a buoyant area to enter into, it appears that some buy-to-let landlords have had their confidence dented as a result of the recent credit crisis," said Jonathan Cornell, managing director of Hamptons Mortgages.

"Amateur landlords will have suffered the most and many may have held off from purchasing new properties - presumably in the hope that the market will begin to calm," he added.

However, figures published last week revealed that buy-to-let investors are still confident about the future, in London in particular, with 54 per cent of landlords in the sector expecting to expand their portfolio in 2008.

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