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Insights into the autumn BTL market
As we enter the Autumn season following an unexpected early September heatwave, it's a crucial period for the BTL sector, which has faced a fair share of heat from various angles, including the market, economic factors, and interest rates.
It's not uncommon for long-standing landlords to encounter challenges in this marketplace. However, in recent years, these challenges have ramped up. Many newer, accidental, or speculative landlords find themselves less equipped to handle these issues compared to their more experienced counterparts. This shift has led to a greater focus on portfolio landlords, and this trend is expected to gain further momentum.
See our flexible approach to portfolio landlords.
This is traditionally a busy time of year for advisers when it comes to supporting a range of landlord clients with their refinancing needs. In line with some well-publicised rate cuts from an array of lenders across the sector and house prices coming under increasing pressure in many regions of the UK, we could also see some gradual uplift in the BTL purchase market. The ones to watch are the portfolio landlords who are in a position to take advantage of properties available below market value attractive for returns in the wake of growing tenant demand.
Contact your local BDM to see how we can support your new and existing cases.
Recent data from Legal & General Ignite reveals a 22% increase in searches by portfolio landlords from July to August, indicating their interest in expanding their buy-to-let portfolios. Additionally, some landlords are entering the market with financial support, as evidenced by an 18% increase in searches for landlord/vendor gifted equity in August. There's also a 22% rise in searches for holiday lets and Airbnb properties, reflecting landlords’ efforts to capitalise on the demand for staycations. These trends emphasize the need for BTL lenders to offer a wide range of options to advisers, including those dealing with unique circumstances like HMOs, expat properties, or short-term lets.
Take a look at our key criteria for specialist property types.
In a market that often appears uncertain, maintaining flexibility is crucial to adapt to shifting conditions. However, one certainty is the resilience of a significant proportion of portfolio landlords who remain committed to their existing and future property investments. According to Q2 2023 Landlord Panel research from BVA BDRC, portfolio landlords are more likely to plan for remortgaging in the next 12 months compared to their consumer BTL landlord counterparts (42% vs. 18%). This reliance on the intermediary market will help them establish a stronger foundation for their portfolios in the present and future.
*This article was originally published on the Intermediary
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