While conditions for buy-to-let (BTL) investors are still far removed from the heady days of 2007, there are some signs of promise in the market.
Research conducted by Moneyfacts.co.uk has found that rates in the BTL market are falling, and the number of lenders and products is increasing.
Aldermore has made a successful entrance to the BTL market, while The Mortgage Works continues to offer the widest choice for borrowers.
This time last year there were 45 active lenders in the BTL sector; today there are 54. In the last month alone both Darlington BS and Paragon have returned to the BTL fold.
The number of mortgages available continues to grow. Noticeably, the deals for landlords with a 20% deposit have seen a threefold increase in the last year, after dwindling away to virtually nothing the year before.
There are now 12 deals at this level to choose from, with numbers increasing markedly as LTV levels fall.
Investors looking for a 75% LTV mortgage currently have a choice of 99 products, up from 65 in October 2009.
Over the same period the number of 60% and 65% LTV mortgage available to BTL investors has increased from 68 to 82 and 29 to 57 respectively.
Those looking to fix their rates have seen the average charge fall from 6.01% to 5.49%, although the average variable product has increased from 4.50% to 4.74%.
"The BTL market has taken a big hit in the last few years, but it is slowly starting to fight back.
"Lenders are returning to the market, bringing much needed competition back to the sector," said Michelle Slade, spokesperson for Moneyfacts.co.uk
"The best deals will continue to be offered to those with a sizable deposit, but those with just a 20% deposit are starting to see more options.
"Rental income and tenant demand continue to rise due to an increase in people opting or needing to rent rather than buy.
"The market has also seen a rise in the number of accidental landlords, as some borrowers are taking in lodgers in order to be able to afford their mortgage.
"Affordability remains a key issue in the BTL market.
"Rental income does not move with base rate and lenders are concerned that borrowers on variable rate deals may not be able to meet repayments when rates rise."
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