Latest research from Paragon Mortgages says that almost 9 out of 10 landlords had found it more difficult to secure a buy to let mortgage in the last 3 months, compared to the previous 3 months. Now the cynical amongst you may say Paragon obviously have a lot of time on their hands at the moment, and therefore are thinking of ways to keep their profile in the news whilst awaiting new funding lines. (As an aside, I always really liked Paragon for their underwriting and range of mortgage products. It will be a great day for landlords when they are back in the market – anyway, I digress).

Now it’s true that lending in general, and in particular the number of buy to let products, has had a massive reduction in choice over the last couple of years but my message is simple: there is still funding out there. 

We need a new bank.

Many people within the industry are seeing increasing levels of new buy to let enquiries – we certainly have. The major issue, however, is still the lack of lenders and products in this marketplace. As predicted the merger of Lloyds and HBoS, while necessary, has not done anything to increase competition and so spur on the development of better rates and products.

So what we need is a new entrant or two to the market. The slightly leftfield emergence of Bank of China was a good sign, however their lending criteria knocked out so many potential clients, they will probably only do about 10 mortgages a month. Once one new bank enters (or re-enters, Bank of Ireland - if you’re listening) the market it will lay the groundwork, and soften the barrier to entry for many others. Like a group of mumbling boys, staring at their shoes at a sixth form dance, someone needs to make the first move.