CML predicts fewer buy-to-let property purchases in 2017

The Council of Mortgage Lenders (CML) says the number of houses bought by landlords next year is likely to fall as several headwinds reduce demand for buy-to-let property. This includes the recently-introduced additional 3% Stamp Duty for buy-to-let purchases, the Prudential Regulation Authority’s buy-to-let lending stress tests starting on January 1st, and the new and less generous tax allowances for landlords, which kick off in April next year. Consequently, CML director general Paul Smee (pictured, below) says that although the overall mortgage market is resilient and will ‘plateau’ during 2017, buy-to-let lending is to likely to decline. The CML predicts that total lending for all types of mortgages in 2017 will be £248 million, approximately the same as 2016, before increasing in 2018 to £252 billion. But lending for new buy-to-let purchases is to decline in both 2017 and 2018, it says. “We expect any modest strengthening in home-owner lending to be rather offset by a less active house purchase market in buy-to-let, as both tax and regulatory changes bite on landlords,” says Paul. But lending is not the only dial on the buy-to-let market to be going down. Lender Landbay says average UK rental growth during 2016 halved from 2.34% to…