Gives us more cash to invest, urge buy to let landlords

Landlords are urging buy to let lenders to make more money available so they can plough more cash in to property investments. Nearly two-thirds of landlords would like to expand their portfolios, but feel lack of support from lenders is holding them back, according to a survey for the second quarter of the year by landlord loan specialist Mortgages for Business. Confidence in the buy to let sector is buoyant - with 60% of landlords ready to buy more property and only 3% looking to sell, down from 6% last quarter. “Landlord appetite for buying residential property is high. This will support the private rented sector and ease the strain on would be renters chasing too few properties,’ said David Whittaker, managing director at Mortgages for Business. The report also found houses in multiple occupation (HMOs) are increasingly popular with landlords due to higher yields. A quarter of landlords want to invest in HMOs. Worringly, 8% of landlords have been asked to seek finance elsewhere by their lenders - mainly by the Royal Bank of Scotland, which wants to lower exposure to the market, and Bradford & Bingley, which wants to leave the market. Meanwhile specialist buy to let lender Paragon Mortgages reveals the best yields are from rental properties in Yorkshire & Humberside (6.8%), while the worst comes from the East Midlands (6.5%). Average yields are 6.2% across the UK. John Heron, Managing Director of Paragon Mortgages, said: “The second quarter has remained largely static in terms of the rental yield that the majority of landlords are achieving. However, to achieve an average yield of between 5% -7% is extremely healthy and shows that portfolios are performing well.” Coventry Building Society has launched two new fixed rate deals for buy to let borrowers. The mortgages offer five year fixes of 5.6% at 75% loan-to-value with a £250 booking fee and a £1,499 arrangement fee and 5.8% fix on the same terms, but with an arrangement fee reduced to £749.

Landlord blog

Sam Dickinson

Further reading

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Ministry of Justice lacks rent rise data from FtT decisions

Landlord buy to let deal choice hits historic peak