Buy to let increase provides profits for Paragon

In the next couple of months Paragon Mortgages has predicted a doubling of buy to let mortgage business.

The prediction came along with the announcement of a 10% rise in half year pre-tax profits for the company’s parent The Paragon Group of Companies PLC. This was on the back of a 15% rise in buy to let lending that looks set to continue.

‘The pipeline of new business is very healthy at £241.2m’, said director John Heron. This represents more than a doubling of expected future business in the three months to the end of March, he  confirmed.

‘We are continuing to see growth in the buy to market as demand from landlords increased, tenant demand remains strong and levels of optimism stay high.’

‘Since the beginning of January we have successfully launched 42 limited edition products through our Mortgage Trust brand which has generated significant business due to market-leading rates.’

‘We are expecting to see a significant increase in loan completions in the second half of the financial year following such a successful period, as the benefit of this increase in lending activity comes through.’

The company announced pre-tax profits of £49.1 million, an increase from £44.8 million at the same time last year.

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Rents up for sixth month in a row, according to Countrywide

Average monthly rents across Britain increased for the sixth month in a row to £842.

The statistic is from Countrywide, the UK’s largest chain of agents, which said that the best yields for landlords are being reached in Wales at 6.7%, followed by the North and Midlands, both at 6.5%.

The best yields are mainly on one bedroom properties and smaller properties.

Average monthly rents for April fell in some regions, London, the South East and Wales. Countrywide places the fall in central London down to high stock levels in comparison with last year, when the Olympics were coming up. They say that this April, tenants viewed multiple properties and put in offers lower than the asking price, with some landlords accepting these offers.

Countrywide, who use their own data of 50,000 properties that they manage across England, Wales, and Scotland, say that rent arrears are declining in all regions apart from Scotland.

The company also says that buy to let property investments remain a strong performer when compared with savings and other vehicles of investment, and they predict that this will continue.

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250,000 people over 50 say they can only pay off mortgage by selling their home

According to The Saga Equity Release Advice Service, underachieving funds have left numerous people over the age of 50 with interest only mortgages facing an average deficit of £49,000.

Half of the 8,000 over-50s who were interviewed by Saga said they have not moved home for more than 20 years yet a quarter add that they will have to sell their home in order to make up the deficit from their endowment policy.

One in thirteen of those facing a deficit have bought themselves some extra time by extending their mortgage, while a third plan to dip into their savings to pay off their mortgage. About one in ten don’t know what they will do to pay their outstanding balance on their home.

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