Half of mortgage intermediaries reported that buy-to-let applications increased during the second quarter, according to the latest research by Paragon Mortgages

The Financial Adviser Confidence Tracking (FACT) Index, carried out by the specialist buy-to-let mortgage lender, found that, on average, the intermediaries interviewed conducted 5.4% more buy-to-let business in Q2 than in the first quarter.

Availability of buy-to-let finance also improved significantly during the past three months. Of the intermediaries surveyed, 64% thought that availability improved and just 8% felt that it deteriorated.

Of specific interest is that 47% of buy-to-let mortgages processed by intermediaries in the second quarter were for landlords looking to extend their current portfolios, a figure which has increased from 43% in the first quarter of 2011. Mortgages for first-time landlords totalled 21% in Q2, which was up from 18% in Q1. while the proportion of remortgages fell during the second quarter to 28% (35% in Q1).

John Heron, Paragon Mortgages Managing Director, said: “Government statistics just released indicate that more than 17% of English property is now in the private rented sector. All of the market indicators, however, suggest that there is still not enough property for new tenants.

“Better availability of buy-to-let finance, particularly for professional landlords, is critical to the expansion of the supply of rental property. It’s therefore, good to see that this is starting to come through.”