Submitted on Tuesday 22nd April 2008
Abbey National exit B2L market
Abbey National have announced their exit from the Buy to Let market. They were very late entrants and after a brief flurry of competitive products have again opted out leaving the market poorer following the current absence of Capital Home Loans and Paragon
Capital Home Loans have decided to lay off about 50 of their 250 UK staff.
This is strategic decision based taken by their Irish parent Irish Permanent ,who have much experience of what happens in an overheated market from Ireland
Capital Home Loans intend to focus on margin and quality rather than quantity
The UK specialist Buy to Let sector will miss any reduction in the appetite of Capital Home Loans especially since the absence since 2007 of Paragon as a meaningful competitor. For the last few years both lenders had been prime candidates for the business of portfolio owners particularly in the HMO markets.
Paragon themselves have also decided to lay off one third of their staff as part of their rationalisation merger with Mortgage Trust. Paragon are very reliant on warehouse funding which in the current market has all but dried up.
