But 2015 could be the best year yet for buy-to-let deal issuance, says Moody’s
to the rapid growth of the BTL recent years,” she said.
“Repeat issuers and new players will support a robust pipeline of BTL RMBS deals this year. Issuance for this segment has accounted for 25.6% of total UK RMBS issuance so far this year, up from 10.2% in 2014,” she noted. Over the coming months, Moody’s forecasts that reduced demand for BTL properties will soften UK house price growth. Moody’s forecasts that UK house prices will nonetheless rise by up to 5% in 2015, albeit at a slower pace than in 2014.
“Notwithstanding the softening in house price growth, the risk of an immediate house
in price decrease is limited given the housing shortage and the economic recovery,” said Rombeau.
According to the Moody’s report, the BTL market has grown at a steady pace since early 2010, accounting for 16.8% of total gross mortgage lending and 25.3% of total house purchases as of Q1 2015. BTL gross lending volumes have substantially increased, rising to GBP 7.6 bln in Q1 2015 from GBP 2.0 bln in Q1 2010.
Paragon, the UK’s largest buy-to-let specialist, has accounted for around 40% of BTL issuance since the financial crisis, with a total of nine transactions collectively worth