The average loan-to-value (LTV) of investment property portfolios has fallen to its joint-lowest level in over 15 years.
The latest PRS Trends report by Paragon has found that the average LTV of investment property portfolios was 35% in Q4 2017.
The report also found that more than half (51%) of landlords said any decision to sell properties was not dependent on rising mortgage interest rates.
Of the remaining 49%, the average mortgage interest rate at which landlords said they would consider selling properties was 5%.
More than four out of ten landlords (43%) said that rent increases were not dependent on mortgage interest rates, while just over half (51%) said that any decision to refinance properties was not based on interest rates.
John Heron, managing director of mortgages at Paragon (pictured above) said: “Since that peak in 2012, gearing has been on a downward trend and currently sits at an all-time low of 35%.
“In response to fiscal changes over the last two years, landlords are clearly less willing to take higher loan-to-value mortgages and borrow more, whilst regulatory changes – though welcomed by lenders – have constrained the market in its ability to offer higher LTV mortgages.
“There is no evidence to suggest lending to landlords has been anything other than sustainable.
“With low levels of gearing landlords appear well positioned to withstand the higher interest rates that the markets are anticipating, which is good news for buy-to-let and the wider private rented sector.”
SIGN UP TO OUR NEWSLETTER TO RECEIVE MORE NEWS LIKE THIS STORY
OakNorth to double size of Manchester team
OakNorth has announced it will be doubling the size of its Manchester team due to an increase in demand for its loans in the region...
UTB hires Simon Burnell as head of product development
United Trust Bank (UTB) has appointed Simon Burnell (pictured above) as head of product development for its mortgages and bridging division...
Monzo raises £20m in latest crowdfunding round
Monzo has raised £20m in just over two days via its third crowdfunding round...
Could more banks look to use gamification?
Gamification is defined as the application of typical elements of game playing to other areas of activity, typically as an online marketing technique to encourage engagement with a product or service...
Bank Leumi (UK) appoints chief business officer
Bank Leumi (UK) has announced the appointment of Andy Mallin (pictured above) as chief business officer...
Handelsbanken launches UK banking subsidiary
Handelsbanken has launched its new UK subsidiary Handelsbanken PLC as it looks to continue the next stage of its growth in the UK...
Making the most of savings in 2019
Personal finance headlines and best-buy tables are dominated by retail savings products, with very few column inches dedicated to helping businesses determine the best places to stash their cash...
PCF posts 44% pre-tax profit increase
PCF Group PLC has reported a 44% increase in pre-tax profits to £5.2m (2017: £3.6m) in its preliminary results for the year ended 30th September 2018...
Mortgage Sleep Out raises over £100,000
Mortgage Sleep Out has raised more than £100,000 for End Youth Homelessness (EYH)...
Gatehouse Bank launches home purchase plan product
Gatehouse Bank has announced the launch of its first home purchase plan product after securing regulatory approval...
Monese offers free premium current accounts for dual UK/EU citizens
Monese has announced the launch of free premium current accounts for those holding dual EU/UK citizenship...