BTL market sees the largest fall in products in 8 years
2017 is set to be an uncertain year, which could be a lethal cocktail for landlords
New Moneyfacts data has revealed a "significant drop" in BTL product numbers as 74 deals are withdrawn from the market in just one month.
According to the report, the total number of live BTL products stood at 1,482 in December but has fallen to 1,408 this month. The 75% loan-to-value sector has seen the largest reduction in product numbers, falling from 606 to 540 in just one month.
Moneyfacts says it is "little wonder" that the BTL market has taken a hit due to tougher affordability rules coming into play on 1 January and more changes due in September .
However the total number of products available remains higher than the 1,256 recorded in January 2016.
Charlotte Nelson, Finance Expert at Moneyfacts, said: “The BTL mortgage market took a hit last month, seeing the largest reduction in product numbers since March 2009. Usually, the month of December is quiet, with providers gearing up for the holidays. This time, however, the BTL market has seen a surge of activity, with the number of BTL products falling back to July 2016’s levels. Withdrawals have not been limited to just a few providers, either, with the reductions having been spread across the board.
Alongside tougher affordability, major changes to the way in which income from property rentals is taxed will be coming in April. Lenders are perhaps withdrawing products to get back to just their ‘core’ range in an attempt to wait and see what other providers will be doing in the run up to April.
2017 is set to be an uncertain year, which could be a lethal cocktail for landlords, particularly now there are less products on the market. Anyone unsure about their options should seek out a financial adviser.”