here were 32,000 buy to let loans, worth £3.5 billion, taken out from April to June, the highest number and value since the last quarter of 2008.
Remortgaging accounted for 65% of the overall increase in buy to let lending in the quarter. The value of the 15,230 loans for remortgage, at £1.6 billion, was 27% higher than in the first quarter and accounted for 53% of the total gross buy to let lending, up from 51% in the first quarter.
The number and value of outstanding buy to let mortgages continued to grow, the figures also show. At the end of the second quarter, 1.34 million buy to let mortgages, worth £154.5 billion, were outstanding, up from 1.26 million, worth £148.8 billion at the end of the same period in 2010.
Although this quarter's increase is significant, the market is currently running at around one third of the levels seen at the peak of lending in 2007, the CML said.
For the first time since 2008, arrears rates for buy to let mortgages are lower than in the owner occupied sector. In the second quarter, all buy to let cases where loans were over three months in arrears, including those under control of a receiver of rent, were, at 28,100 or 2.09% of the total, 0.05% lower than in the owner occupied sector.
However, repossessions in the buy to let sector increased by 9% from 1,700 in the first quarter, to 1,900 in the second.
There has been resurgence in the number of first time property buyers in the UK being granted loans. June saw the highest number of mortgages taken out by first time buyers for 10 months. There were 18,100 loans to first time buyers, worth £2.2 billion, 24% higher by volume and 29% higher by value than in May.
June's first time buyer numbers were exactly the same as in last August, but 8% lower by volume and value than in June 2010.
‘If you consider the buy to let recovery alongside the increase in first time buyer numbers it appears that first time buyers are not being displaced by buy to let landlords but are holding their own in a restricted market,’ said CML director general Paul Smee.
‘So, this is encouraging news for those who want to rent, as long as it is realised that much of the current increase is for remortgage rather than house purchase,’ he added.
The figures also shows that home movers took out 28,600 loans, worth £4.6 billion, in June, up from 23,800, worth £3.7 billion in May, but down from 32,800 loans, worth £5.3 billion, in June 2010.
Overall, there were 46,700 loans for house purchase, worth £6.7 billion, in June, up 22% in volume and value from May, but down 11% by volume and 13% by value on June 2010.
Remortgaging was unchanged in June, totalling 30,700 loans worth £3.8 billion. Unlike lending for house purchase, however, remortgaging was up 10% by volume and 9% by value on June 2010.
Lending for house purchase increased in the second quarter. Between April and June, there were 122,000 loans for house purchase, worth £17.6 billion, up from 97,200, worth £14.1 billion, in the first quarter. But lending for house purchase was lower than in the second quarter last year, when there were 138,300 loans, worth £20 billion.
