What you need to know

Amid substantial regulatory intervention, the buy-to-let mortgage market experienced its first fall in sales since the financial crisis in 2017. Tougher lending criteria, a less favourable tax environment, higher entry and running costs and declining rental yields have contributed to reduced demand and cooled down a market that saw double-digit growth rates for years. However, as potential investors adapt to the ‘new normal’, the market returned to growth in 2018, with providers focusing on competitive remortgaging activity and a product proposition that reflects a changing demand.

This Report provides an overview of the buy-to-let mortgage market, including an assessment of the sector’s recent performance and short-term prospects. An overview of recent regulatory and legislative changes is provided, including an analysis of their effect on provider strategy and launch activity.

Mintel’s exclusive consumer research identifies those who own investment property, how long they’ve owned it for and how they originally acquired it. It assesses owners’ short-term plans, including reasons for potentially ending their investment. Additionally, we explore attitudes towards investing in property among the general population, together with interest in and concerns about doing so. Target groups are identified through cluster analysis. Lastly, we look at awareness of indirect property investments.

Products covered in this Report

This Report examines the UK market for property investment and second home ownership. This encompasses residential buy-to-let, properties let to family and second/holiday homes, located in the UK and abroad.

For the purposes of this Report, Mintel has used the following definitions:

  • Second properties refer to properties that are owned and used by family/friends as a holiday home (ie not a main residence), let to others as a holiday let, for occupation while working away from home, rented or other. They may be purchased outright or bought with a mortgage. They may also be inherited.

  • Second homes are a sub-set of the above and refer to second properties that are kept mainly for personal use, as opposed to being rented out to tenants. However, they may include occasional lets.

  • Buy-to-let properties are properties bought with the purpose of renting them out. They may be purchased outright or with a mortgage.

  • A buy-to-let mortgage is a special type of mortgage advanced on a property that is, or is intended to be, let to tenants. Viewed as a form of commercial lending, they fall under the remit of the PRA (Prudential Regulation Authority).

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