According to a leading landlord mortgage broker, the first quarter of
2013 has seen a surge in the number of landlords seeking new finance
deals in order to buy new properties. This increase reflects how
confident experienced buy to let landlords are that the current
market conditions are unlikely to change any time soon.
Remortgaging deals
Refinance mortgages only represented 43% of landlord finance deals at
the end of 2012. This figure has now risen to 69%, which is a very
large piece of the pie. Other figures show that refinancing deals on
Houses in Multiple Occupation (HMOs) are now becoming increasingly
common, as landlords seek to cash in on the demand for rental
accommodation.
Will this trend continue?
The signs are certainly looking good. The country is still in the
grip of a tough economic climate and the demand for rental
accommodation is far outstripping supply in many areas, particularly
London and the South East. With this in mind, it is hardly surprising
that landlords are hoping to cash in by trying to expand their
property portfolios. The more properties you have, the more you can
spread the risk of rent arrears and long void periods.
Mortgages and lenders
At one stage it was quite difficult to find lenders willing to offer
finance deals on buy to let properties, but with the increasing
demand for rental properties, more and more lenders are seeing the
light. There are fewer mortgage products on offer now, but this has
more to do with the fact that lenders are streamlining their products
rather than making it more difficult to borrow money.
