Constrained mortgages 'prevent landlord buying'

Date:Tuesday 19th January 2010
Author: Susanna Kavka

Plans by landlords to purchase properties during the early months of this year appear to be running into difficulties as many are struggling to get mortgages.

Around ten per cent of the landlords questioned by Paragon Mortgages admitted that they were planning to expand their portfolio this year.

But 67 per cent said they found it more difficult to secure a mortgage during the fourth quarter of last year, when compared to the third quarter.

However, some were reporting good news, as seven per cent stated that they had found it easier to obtain a mortgage in the final quarter of 2009 than in the penultimate one.

John Heron, Paragon Mortgages' managing director, said: "Landlords have told us that it was more difficult to source mortgage finance in the fourth quarter than in the third, and we see nothing to suggest that the situation will improve quickly."

Fixed-rate mortgage popularity dipped in the final quarter of 2009, which may have been down to concerns that the base rate was due to increase, the mortgage provider reported earlier this month.