Paragon said that it focussed mainly on professional landlords which represent 90% of their buy to let business.
The chief executive, Nigel Terrington said:
“In spite of the prevailing macro uncertainties we are well placed to benefit from scale economies in the commercial lending division, and the group continues to cement its position as a leading lender to professional landlords in the UK, underpinned by its 22-year history in this market. We look to the future with confidence.”
The Ministry of Housing, Communities and Local Government has reported that around 4,000 buy to let properties are being sold by landlords every month. This is probably the result of increased costs for landlords who pay extra stamp duty and have had tax benefits on commercial mortgage interest payments reduced. The Paragon buy to let growth forecast suggests that most landlords selling houses are small landlords with one or two properties.
Many large landlords have formed limited companies to save tax on their business and others have diversified by adding commercial and semi-commercial properties to their portfolios.
To stimulate property purchases some lenders have reduced their rates for buy to let mortgages. A commercial mortgage broker is able to find the best deals for landlords. There are also specialist commercial mortgages available for first time buy to let landlords.