Greater financial support is needed to improve liquidity in the buy-to-let mortgage market, says the Intermediary Mortgages Lenders Association (IMLA).

Peter Williams, executive director of the group, believes the buy-to-let sector is vital for economic recovery in the UK.

To date, mortgage relief policies launched by the government since the onset of the credit crunch have not been extended to the buy-to-let sector.

A study into the private-rented sector by research agency Business Development Research Consultants last month found that seven per cent of private landlords had been involved in repossession activity from a lender.

However, it showed that 100 per cent of professional landlords who owned 20 homes or more were making profits on their buy-to-let mortgages, leading the firm to conclude that "portfolio size is key to survival".

But all private landlords could benefit from increasing demand from would-be first-time buyers after lenders have tightened their loan-to-value rates, the IMLA study suggested.

"For youngsters without a substantial deposit, the only alternative is renting,"Mr Williams said. ADNFCR-2002-ID-19028503-ADNFCR

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