A large section of lending has been apportioned to Buy to Let investors capitalising on the buoyant private rental sector” said Joe Billingham, Prosperity founder and chairman. “Naturally, lenders are leaning towards BTL mortgage products due to the more resilient nature of a property that’s producing its own income. Of course, lenders want a piece of the action in a sector that’s holding its own. I’m confident this resilience will continue especially through the coming months as both the markets and people get back onto their feet. The increase also reflects a reluctance to part with large deposits as required when purchasing a house. Many potential home-owners are now left unable to buy, so naturally market forces dictate that demand will be high in the rental market. We’re seeing a marked rise in clients both new and existing, coming to us to help grow their financial portfolios via property over alternative asset classes where returns have been much more volatile due to the current climate.”
Statistically, the number of mortgage deals dropped significantly since the start of the pandemic. “Given the interest rate drops, it was no surprise that many lenders retracted deals reducing the mortgage options by more than half.” continues Joe Billingham. “According to Moneyfacts, a total of 1,660 different mortgages are currently available to investment landlords, up from 1,455 deals at the beginning of May. With our Sherwood House recently completed, and Moseley Gardens, H1 and Chartwell Plaza developments now well into the completions pipeline, this is of course, really positive news.”
Eleanor Williams, finance expert at Moneyfacts, said: “Landlords looking to invest in the buy-to-let sector could see this as an opportune time to explore their options, especially if they think that average rates may continue the upward trajectory we have witnessed over the last two months.”
In conclusion, the current climate is proving fruitful for buy to let. BTL mortgages are more readily available and in turn, this rise in activity is good news for those who want to let their properties, as the current mismatch between supply and demand is forcing rents higher.