Mortgage brokers predict fall in buy-to-let purchases

MOST mortgage brokers are expecting the first drop in buy-to-let purchases in eight years.

Some 55 per cent of more than 1,300 intermediaries surveyed said they believed 2005 would be the first year since the sector took off about eight years ago that the number of buy-to-let mortgages fell.

The research, by Nationwide specialist subsidiary UCB Home Loans, shows 39 per cent of brokers have seen an increase in the number of buy-to-let mortgage applications, while 38 per cent have seen a decline.

"Opinions among brokers over whether buy-to-let mortgage applications have been rising or falling over the past four months are pretty evenly split," said UCB managing director Keith Astill. "Predictions for the year as a whole are that the massive influx of new investors has now passed its peak."

The research coincides with a Royal Institution of Chartered Surveyors study that claims the buy-to-let market has come to a standstill because of rising interest rates.

For a copy of Mortgage Trust and Perrys Chartered Accountants' new tax guide for buy-to-let investors go to www.mortgagetrust.co.uk.