Buy-to-let market sees growth

Borrowers have turned to the buy-to-let market in growing numbers during 2007, it has emerged.

Research by Hamptons Mortgages has revealed that the buy-to-let mortgage market grew by 23 per cent between December 2006 and the same month last year.

Events such as the credit crunch and expectations of a downturn in house prices in December brought about a decline in consumer confidence, with many taking refuge in buy-to-let, suggested Jonathon Cornwell, managing director at the firm.

"The proportion of residential mortgages fell by nearly 11 per cent in October 2007," he noted.

Buy-to-let accounted for 39.53 per cent of loans taken account during the period, with residential mortgages also posting falls of around 17 per cent in November and December, the study revealed.

Borrowers may consider tracker mortgages in 2008, Mr Cornwell indicated, after the Bank of England cut interest rates by a quarter-point in December and further reductions in the base rate are anticipated by some experts in the coming months.

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