The number of buy-to-let mortgage arrears has increased by 28% in the last year, according to a recent report. This is the highest level of arrears since records began in 2008 and is a worrying sign for the buy-to-let market.
The report, which was released by the Council of Mortgage Lenders (CML), shows that the number of buy-to-let mortgages in arrears of 2.5% or more of the outstanding balance has risen from 11,400 in Q2 2016 to 14,600 in Q2 2017. This is a 28% increase in just one year and is the highest level since records began in 2008.
The CML has attributed this rise to a number of factors, including the increasing cost of renting and the introduction of stricter lending criteria for buy-to-let mortgages. The CML also noted that landlords are facing increasing competition from other investors, such as pension funds and overseas buyers, which is driving up prices and making it more difficult for landlords to make a profit.
The rise in arrears is a worrying sign for the buy-to-let market and could have a significant impact on landlords. It is important that landlords are aware of the risks associated with buy-to-let investments and take steps to protect themselves from potential losses. Landlords should ensure that they have adequate insurance cover, as well as a clear understanding of their obligations under the terms of their mortgage agreement.
It is also important for landlords to keep an eye on the market and be aware of any changes that could affect their investments. The CML has urged landlords to seek professional advice if they are unsure about any aspect of their investment.
The rise in buy-to-let mortgage arrears is a worrying sign for the market and highlights the need for landlords to be aware of the risks associated with investing in property. Landlords should ensure that they have adequate insurance cover and a clear understanding of their obligations under their mortgage agreement. They should also keep an eye on the market and seek professional advice if they are unsure about any aspect of their investment.