The most recent financial adviser confidence tracking (FACT) index from Paragon – which captured the experience and views of approximately 200 mortgage intermediaries – has revealed that landlord remortgaging has increased to 57% of all buy-to-let business in Q3 2018, up from 49% in Q2 2018.

By contrast, the proportion of first-time landlord business fell from 14% to 10%, while landlords looking for finance for portfolio expansions was down from 23% to 19% of the total.

The survey also revealed that buy-to-let represented 19% of intermediary business in Q3, with the remainder taken up by mortgage applications from owner-occupiers.

•   Is the BTL market still attractive to lenders?
•   Majority of intermediaries expect landlord business to stabilise
•   Landlord remortgaging close to record levels

“Landlords are investing less in the private rented sector which, in time, is going to make it more difficult for tenants to find a property at a rent they can afford,” said John Heron, managing director of mortgages at Paragon (pictured above).

“This is clearly a response to the increase in costs that landlords face following changes to stamp duty and tax relief on finance costs.

“It’s no surprise, therefore, to see that landlords are taking the opportunity to reduce their mortgage finance costs as one part of their strategy to mitigate the impact of higher taxation.

“Tax bills due in January 2019 will include the first phase impact from the withdrawal of mortgage interest tax relief and landlords are preparing carefully for the next stages ahead.”