The spread in buy-to-let (BTL) is £214,466, with the average maximum loan size £346,153 and the average minimum £131,687.
In residential, the spread is less than half of BTL at £99,475, based on an average maximum £235,475 and minimum £136,000.
This means that while residential loan values available to borrowers are more concentrated, those from BTL lenders can be far more varied depending on the lender chosen.
MBT’s analysis found the residential market is also more frequently affected by changes in the affordability landscape compared to buy-to-let, meaning identifying the right lender is particularly critical for buy-to-let clients.
“Our data shows that choice of lender for landlord clients can make a huge difference to the size of loan they are able to access,” said Tanya Toumadj, chief executive at Mortgage Broker Tools (pictured).
“Carrying out thorough affordability research is just as important in buy-to-let as for residential clients. The affordability landscape may be more stable in this part of the market, with fewer tweaks and changes to calculations, but the consequences of not choosing the right lender are more significant.”
“Many investors are keen to maximise leverage to make greater use of their capital, so it’s important for brokers to be able to easily identify lenders providing larger loans.
“Choosing the wrong lender could limit a landlord’s options and significantly impact the success of their investment strategy,” Toumadj said.