'More competitive' buy-to-let sector could boost equity release

One mortgage provider has announced the introduction of new 80 per cent loan-to-value (LTV) products for buy-to-let property investors, in a move that could boost the future prospects of the equity release sector.

The Mortgage Works has become the only lender to offer 80 per cent LTV mortgages for landlords at the present time, meaning that buy-to-let property buyers with smaller deposits may be able to enter the market.

Moving up to 80 per cent LTV represents "a fundamental shift in lenders' attitudes to risk", believes Lee Grandin, managing director of Landlord Mortgages.

The move will lead to more competition, meaning that the sector could be heading in the right direction, he added.

Another property expert, meanwhile, has suggested that house prices appear to be on an "upward curve", in what may be a further boost for the equity release sector.

Ben Wilkie, editor of What Mortgage, conceded that heavy spending cuts and future job losses could impact negatively on the housing sector but, if conditions become more favourable, we may be in for a sustained period of house price growth.

Ashall Glover Financial Services are equity release specialists