The Telegraph is reporting that ‘Over the past nine months, buy-to-let investors have paid down around £363m of mortgage balances, new analysis shows, as they try to minimise the impact of higher borrowing costs.’
The article can be seen here (subscription may be necessary) and goes on to say ‘ Data from UK Finance shows that the total volume of outstanding buy-to-let debt shrank by £1.2bn between February and August this year.
Around two-thirds (69pc) of this was linked to landlords selling properties, while 31pc was due to buy-to-let investors paying down debt, according to analysis by estate agent Hamptons.
This is a marked shift after outstanding buy-to-let debt rose continuously since UK Finance started recording data in 2013. Over the decade, it rose 84pc to hit £305bn by February 2023.’
Separate data from UK Finance shows how landlords have been steadily reducing the size of their loans in response to interest rate rises.
Between the start of 2021 and spring 2023, the share of buy-to-let mortgages with high loan-to-value ratios has shrunk significantly, while the share with lower LTVs has swelled.
The share of outstanding buy-to-let loans with LTVs between 70pc and 80pc dropped from 17.8pc to 15.1pc, while those with LTVs of less than 40pc leapt from 15.4pc to 19.4pc.
This suggests landlords are paying down parts of their largest loans or selling properties that have particularly high debt costs.