Marketing No Comments

Broker buy-to-let confidence continues to increase

Some 53% of mortgage intermediaries expect to see an increase in buy-to-let business over the next 12 months despite the tapering of the stamp duty holiday, according to research from , Paragon Bank.

This figure, which covers the second quarter of 2021, compares to 50% in the first quarter of the year, whilst the proportion expecting declining levels of buy-to-let business remained consistent at 10%.

Moray Hulme said: “These figures suggest that the strong levels of buy-to-let business witnessed over the last six to nine months wasn’t just as a result of the Stamp Duty stimulus, but down to more fundamental shifts in where and how people want to live.

To find out more about how we can assist you with your Mortgage requirements, please click here to get in touch

“We still expect to see business levels moderate as the stamp duty holiday ends but landlords are seeing plenty of opportunities to expand their portfolios to meet excellent levels of tenant demand and changes in the type of property people now want to rent.

“There has certainly been a growth in tenant demand for family homes, for example, and landlords are reacting accordingly.”

Brokers also reported that demand for buy-to-let was strong during the quarter itself, with 42% of intermediaries stating demand was ‘strong’ and 8% ‘very strong’.

Discover our Buy to Let Mortgage Broker services.

That compares to 26% in the corresponding period last year at the height of the pandemic.

Just 10% of respondents reported buy-to-let demand as weak during the period, compared with 30% during the second quarter of 2020.

Moray Hulme added: “Mortgage brokers have experienced a busy 12 months after the initial panic of the coronavirus pandemic.

“They enter the second half of 2021 in a confident, robust mood, which is indicative of the underlying demand for mortgage products.”

Source: Mortgage Introducer

Discover our Mortgage Broker services.

Marketing No Comments

Third of landlords either bought or buying new buy-to-let properties

More than a third (34%) of landlords have recently purchased another buy-to-let property (BTL) or intend to buy one within the next nine months, a survey by The Deposit Protection Service (The DPS) and Zephyr Homeloans has found.

Results from the poll of 300-plus landlords suggest that the ‘opportunity to buy at a discount’ is the most commonly cited reason among those who have recently bought or soon intend to buy additional rental property.

Other key factors including long-term investment (35%), stamp duty savings (34%) and diversification by either location (26%) or property type (23%).

Paul Fryers, managing director at Zephyr Homeloans, said: “Understanding the purchasing motivations behind professional landlords is an essential factor for Zephyr and our mortgage broker clients.

To find out more about how we can assist you with your Mortgage requirements, please click here to get in touch

“It’s equally important to recognise and appreciate some of the challenges landlords have been facing during the past year and how they will affect their current and future applications.

“During the pandemic we saw a significant rise in the use of limited companies to buy and manage property portfolios, and it seems a significant proportion of landlords have made the most of the opportunities provided by the buoyant market conditions we have experienced over the past six months.”

Some 43% of landlords surveyed said that they had temporarily lowered rents during the pandemic to help tenants, with 22% saying they had refinanced their mortgages since the arrival of coronavirus.

Discover our Buy to Let Mortgage Broker services.

Matt Trevett, managing director at The DPS, added: “Although the buy-to-let market has remained more buoyant than some predicted, the last year has not been without its challenges for many tenants and landlords.

“The survey suggests a large proportion of landlords have been acting to support their tenants, with a significant proportion saying they had temporarily lowered rents during the pandemic.

“A recent survey from The DPS also showed that the pandemic has triggered movement from cities to towns and the countryside, so landlords seeking to rebalance their portfolios may look to make purchases that reflect that trend.”

Source: Mortgage Introducer

Discover our Mortgage Broker services.

Marketing No Comments

Northern regions remain strong for buy-to-let investment

Buy-to-let properties in the North continue to present an attractive investment opportunity for landlords, offering some of the highest price rises and rental yields.

The UK house price index for February showed the North West was the English region with the highest annual price growth. Average prices in the region rose by 11.9 per cent to £184,351 in the year to February, up from 10.5 per cent in the month before.

By comparison, London saw the lowest annual growth, where average prices increased by 4.6 per cent over the year to February, down from 5.7 per cent in January.

Rental yields in Q1 2021 were also highest in the North, particularly in the North East (9.1 per cent), Yorkshire and Humberside (8.2 per cent) and North West (7.8 per cent), according to data.

To find out more about how we can assist you with your Mortgage requirements, please click here to get in touch

Angus Stewart said: “For landlords it is all about yield – how much rental income versus the price they pay for the property.

“For quite some time this has meant a shift away from London and the South East where historic higher house prices have outweighed the rental income available. This has been exacerbated by the Covid crisis that has hit rental income in London in particular.

“So, it’s not surprising to see in these figures house prices have been rising in the North West and Yorkshire in particular as investors chase those higher yields. At the moment these areas still look attractive for landlords as they are providing the rental income and the opportunity for capital appreciation.”

Discover our Buy to Let Mortgage Broker services.

Average rental yields by region, Q1 2021

RegionAverage rental yield
North East9.1%
Yorkshire and Humberside8.2%
North West7.8%
East Midlands6.7%
West Midlands6.5%
South West6.0%
Wales5.8%
East Anglia5.6%
South East5.1%
Greater London5.0%

Anthony Rose added: “Buy-to-let investors are viewing areas in the North as having very strong rental yields and the opportunity for further house price growth.

“As currently they only have to pay the 3 per cent stamp duty surcharge, this is offering very attractive investment opportunities with relatively small initial capital outlays, which is further increasing demand in these areas.”

By Chloe Cheung

Source: FT Adviser

Discover our Mortgage Broker services.

Marketing No Comments

Holiday let deals surge – can supply keep up with demand?

A jump in the sale of homes for holiday let purposes has corresponded with an increase in mortgage options for borrowers keen to cash on this flourishing areas of the buy-to-let market.

This is according to the latest data from Moneyfacts.co.uk which has revealed a ‘notable’ rise in the number of buy-to-let options for holiday lets over the past six months.

The figures are released as prospects of Brits being able to travel overseas for holidays this year continued to look uncertain.

Moneyfacts revealed today mortgage options for borrowers looking at holiday lets had grown by 45% in the past six months and product availability was double that in August 2020.

The analysis drew on research from Hodge Bank, which showed, over the past six months, there had been a surge in sales of holiday homes near the coast.

To find out more about how we can assist you with your Mortgage requirements, please click here to get in touch

Moneyfacts said the abundance of holiday let products had returned to levels seen a year ago. However, supply of housing overall meant the market was failing to keep up with demand.

According to Rightmove, new listings of properties overall were not satisfying record buyer demand, with available stock down nationally by 25% year-on-year.

Rachel Springall, finance expert at Moneyfacts.co.uk, said: “Consumers may have taken some time to reflect on staycations in light of uncertainties surrounding international travel and how a holiday let could be a worthy investment.

“Lenders have moved over the past six months to cater to the demand for those looking to invest in property, as there has been a rise in holiday let deals of 45%, and product availability has in fact doubled since August 2020.”

Buy-to-let mortgage market analysis 
BTL options available(fixed and variable)Mar-20Aug-20Oct-20Now
Available to holiday let16274103149
Lenders offering holiday let deals20141721
Average fixed rate available to holiday let3.37%3.53%3.79%3.95%
Source: Moneyfacts.co.uk

Trends

According to Moneyfacts it is the building societies which seem more likely to provide the deals to meet the growing demand – whether for someone who uses their own home or takes out a new loan to fund the holiday let investment.

Springall cited research from Hodge Bank, which revealed of those purchasing a holiday home, 65% took out a new holiday let specific mortgage and 35% remortgaged their existing home to finance their holiday home.

Discover our Buy to Let Mortgage Broker services.

Supply and demand

Springall added: “Supply and demand may well be a key issue in 2021 for investors who feel staycations are here to stay awhile yet, and indeed according to Rightmove, national new listings stock is down 25% year-on-year.

“Any lack of holiday home opportunities will come as frustrating news for investors considering the return of holiday let deals on to the market, especially as sales figures nationally are rising and some consumers have more disposable income from lockdown and are therefore ready to invest.

“Data from PropertyMark cited that one in nine properties nationally sell more than the asking price, with recent figures hitting a five-year high.

“Clearly, for any opportunities that prospective borrowers are contemplating, it is wise they approach an independent qualified financial adviser to go through the deals currently available and to get some valuable insight into the workings of a holiday let, including tax benefits, rules regarding residency periods, rental income desirability and requirements, and other potential expenses outside of utility bills.”

Source: Mortgage Finance Gazette

Discover our Mortgage Broker services.

Marketing No Comments

Rise in first-time buyers searching for buy-to-let properties

Demand has grown among first-time buyers who want to enter the buy-to-let market, according to Legal & General Mortgage Club.

Data from its mortgage criteria search tool found the search combination for first-time buyer, first-time landlord and non-owner occupier increased by 18 per cent since the start of September.

The mortgage club also found that ‘holiday lets’ was the second most searched for term among advisers this month.

According to Legal & General, its findings showed many first-time property investors were looking to purchase buy-to-let properties in response to an increase in demand from consumers to holiday in the UK, rather than abroad, amid international travel restrictions.

To find out more about how we can assist you with your BTL Mortgage please click here

Kevin Roberts, director at Legal & General Mortgage Club, said: “Despite the impact of coronavirus, we are seeing rising demand across the housing market with buy to let in particular enjoying a mini-boom.

“Our latest findings from SmartrCriteria suggest a growing number of first-time buyers are searching for mortgages for buy-to-let ventures, including those engaging with the growing trend towards staycations this year.”

Mr Roberts added: “Amidst this continued high demand we are seeing in the mortgage market, thousands of borrowers are clearly turning to independent advisers to help them with their plans and these experts are playing a vital role for consumers”.

Akhil Mair, managing director at Our Mortgage Broker, commented: “The data L&G have shared today is a very accurate reflection on the type of business and enquiries we have been receiving in the last few months.

“We are witnessing an unprecedented amount of first-time buyer, first time landlord enquiries, including expat and foreign nationals wishing to invest in the UK property market.”

Mr Mair added the “huge interest” his firm had encountered was due to incentives such as the stamp duty holiday.

By Chloe Cheung

Source: FT Adviser

Marketing No Comments

More UK women investing in buy-to-let properties

The number of women investing in buy-to-let properties in the UK has increased slightly to almost half the total, a new study has found.

Women now account for 47% of the 2.5 million buy-to-let investors in the UK up from 46% the year before, narrowing the gender gap in the investment class, according to the research by London estate agents Ludlowthompson.

The number of female residential property landlords rose by 5% to 1.2 million for the 2016/17 tax year, up from 1.1 million the previous year, according to the latest available HMRC data.

The narrowing of the gender gap in buy-to-let investment reflects how property has become an increasingly popular investment among women Ludlowthompson said.

To find out more about how we can assist you with your BTL Mortgage please click here

The company cited research from Kings College London that suggests that women are generally less likely to make high-risk investments. The relatively transparent business model, regular pay-outs, and low price volatility associated with buy-to-let property as opposed to shares has contributed to the rise in popularity of the asset class among women.

The narrowing of the gender gap among buy-to-let investors stands in contrast to the gender split across other asset classes such as cryptocurrency where women represent just 8.5% of investments, and stocks and shares ISAs where women account for only 43%, owning 957,000 shares ISAs compared with 1.2 million men.

Stephen Ludlow, chairman of Ludlowthompson, said: “The buy-to-let sector has a reputation of providing stable, long-term returns. Whilst some investors have become distracted by more speculative investments, buy-to-let continues to build increasing interest amongst investors who value income and long-term growth.

“It may not be long before we see a 50/50 gender split amongst buy-to-let investors, which is significant given the much wider gaps in other asset classes, such as equities.”

By Kalila Sangster

Source: Yahoo News UK