There’s no doubt that the buy-to-let (BTL) market contracted in-line with the various financial crises that ran from late 2007 into early 2009.

Yet the latest figures indicate that the latter parts of 2009 show a return to growth in mortgages advanced for BTL acquisitions.

It seems as if a little confidence is returning to the market after 18-24 months of real difficulties. Of course buyer confidence alone isn’t sufficient to drive growth – the banks and other finance sources also have to be prepared to lend and the figures may indicate that this is now happening.

Both the third and fourth quarters of 2009 showed growth in BTL mortgage lending which, coming after seven consecutive quarters of reductions*, has to be good news both for the BTL market and related areas of the economy such as those companies providing let properties insurance.

BTL lending in 2009 was still considerably down on the figures for 2007 and 2008* showing just how much lost ground still needs to be recovered. Even so, in 2009 11.8% of all mortgage lending remained targeted at BTL purchases*.

Deciding whether or not to enter the BTL marketplace is not a decision that you’re likely to make based on a single set of statistics but these figures do appear to show that buying properties with a view to letting them out continues to be something seen by many as an opportunity.

What is difficult to say is what exactly this growth may indicate for 2010. Many economic indicators appear to be looking a little more favourable than they did even 3-4 months ago. Most experts appear to agree that the recovery will continue though some suggest that it will continue to be fragile.

The general election will inevitably play a part in setting the direction for the middle and latter parts of the year. Yet with all the main parties seemingly agreeing that there is a shortage of affordable rental properties and the banks being put under increased pressure to free-up financing, the outlook for BTL in 2010 may be more promising that it has been for a considerable time.

* SOURCE: The council of mortgage lenders press release dated 11 February 2010.