The rental mortgage market is gaining confidence

The rental mortgage market is gaining confidence as homeowners continue to take out larger mortgages in anticipation of continued rising house prices and positive rental yields.

Data from specialist lender Keystone Property Finance revealed that mortgage products designed to offer exclusive rates for larger loan amounts are the most popular product among rental owners.

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More than half (58%) of Keystone customers have applied for the lender’s larger loan portfolio since December 2020. The range covers loan sizes between £ 250,000 and £ 1million and offers rates ranging from 3.09%.

Keystone Property Finance said the increase in popularity of larger loans could be attributed to homeowners looking to take advantage of the stamp duty holiday and be able to afford more expensive properties through the tax savings, as well as to expect a continuous increase in the future. positive real estate prices and rental yields.

The data also showed that nearly two-thirds of applications (62 percent) for the lender’s larger loan products came from owners of limited liability companies, compared to 38 percent of applications from individual owners.

Read more: P2P real estate loan: the Phoenix rises

“Our data shows that homeowners remain confident in the buy-to-lease market as the majority of clients seek a larger loan to purchase their property,” said Elise Coole, Managing Director of Keystone Property Finance.

“There is no doubt that the stamp duty incentive played an important role in this regard and provided a great opportunity for homeowners to strengthen their portfolios and invest in higher value properties.

“The private rental market plays an essential role for millions of people and at Keystone Property Finance we are committed to supporting our brokers and their owner clients by providing them with a wide range of innovative solutions.

Read more: P2P platforms welcome the extension of the stamp duty holidays

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