Lending at the bank jumped to £721m in the six months to 31 March 2018, up by 23% compared to the same period last year.
Growth over the first half was underpinned by a 21% increase in buy to let, with landlord lending hitting £671m.
The lender’s specialist residential mortgage advances also grew from £0.4m to £23m, as the lender expanded in distribution.
And second charge lending over the period held broadly stable at £28m.
Paragon said it is now on course to reach its previously stated target of more than £1.6bn in total mortgage lending for the full financial year.
The lender reported a pipeline of new buy-to-let business heading into the second half was £788m, up 6% compared with last year.
Buy to let shift
Within buy to let there has been a marked shift to more professional investors, the provider said.
The proportion of Paragon’s advances to corporate and complex landlords over the six months was 72%, up from 60% last year.
There was also a significant increase in borrowers opting for buy-to-let mortgages on a fixed-rate period of five years, making up 72% of advances – double the level recorded in 2017 – according to the lender.
At the same time, customer retention levels at the lender were boosted by Paragon’s online switch and further advance service launched in early 2018.
The lender said arrears on its buy-to-let portfolio remained low at 0.09%.
John Heron, managing director of mortgages at Paragon (pictured), said: “Recent tax and regulatory changes have had a significant impact on the buy-to-let market driving a polarisation between smaller scale and more professional portfolio landlords and a retreat of some lenders from the provision of new products for portfolio landlords.
“Paragon’s many years of experience in this segment and focus on specialist underwriting means that we are well positioned to cater for the requirements of the larger scale, professional landlord with potential to outperform in this strategic segment of the market.”