Data published by the Council of Mortgage Lenders (CML), showed that buy-to-let activity in the first three months of this year settled back to former levels, following a modest upturn in house purchase by investors at the end of last year triggered by the stamp duty.

As a result, according to CML, the number of buy-to-let loans declined by -15% to 22,000 in the first three months of 2010. Over the same period, the value of lending also declined by -12% to £2.1bn.

Not including the impact of the stamp duty holiday, CML believes that buy-to-let lending has remained broadly flat over each of the last five quarters. Compared to the first quarter of 2009, the value of buy-to-let lending in Q1 2010 is unchanged, while the number of loans declined by just -2%.

Low interest rates are continuing to contribute to a modest improvement in buy-to-let arrears. At the end of March, the number of loans with arrears of more than 1.5% of the mortgage balance totalled 19,300 (1.56%) of all buy-to-let loans), compared with 20,700 (1.69% of loans) at the end of 2009, and 28,800 (2.47% of loans) a year ago. According to CML, the number of buy-to-let properties taken into possession in Q1 2010 totalled 1,400, an increase from 1,200 taken into possession in the preceding three months but unchanged from the total a year ago.

Meanwhile, cases where a receiver of rent had been appointed totalled 11,200 at the end of March, down from 11,900 three months earlier but up from 9,200 a year ago. These cases are similar in many ways to a lender taking possession of a mortgaged property, with the landlord being removed and the receiver collecting rent and passing it on to the lender to apply to mortgage payments.