This is also evident as, hopefully, we have, endured the worst of the pandemic. Landlords have faced their fair share of challenges over this period and whilst there was the inevitable early dip, confidence levels have remained strong throughout this time and continue to steadily rise.
This was highlighted in the latest BVA BDRC Landlord Panel research for Q2 2021 across all 5 key business indicators. The majority of optimism indicators reached their highest level for a number of years, and this is particularly the case for confidence in the prospects for capital gains (+22%pts Y-o-Y) and confidence in the UK’s financial markets (+18%pts Y-o-Y). The key metric of ‘Net optimism’ for landlord confidence in their own letting business remains strong but has edged down slightly from the three-year high recorded in Q1 ’21, to +26 (-4pts).
The majority of optimism indicators are now at their highest level for a number of years, with the highest proportion of landlords feeling upbeat about the UK’s financial market since Q1 ’17, and capital gains since the end of 2015. The only measure to see a fall in confidence this quarter is landlords’ own lettings business, which saw a 3%pt decline in those who feel either ’good’ or ‘very good’ about prospects in the next 3 months. Larger landlords are suggested to be typically more upbeat about the prospects for their own lettings business, with 50% of 20+ property landlords feeling ‘good’ or ‘very good’ vs. just 35% of single property landlords. There are also variations by BTL leveraging; Landlords with 4+ mortgages are significantly more upbeat than landlords with 1-3 mortgages (46% vs. 35%).
These are all hugely positive signs which reflect just how important a role the private rented sector has played within the wider housing market and economy as a whole. Looking beyond Q2, opportunities will continue to emerge for proactive advisers from a BTL purchase and remortgage standpoint and competition is likely to heat up, especially from the specialist lending community, to reflect this ongoing confidence. And long may this continue.
If you would like to know more about how we can help your landlord clients, speak to our specialist BTL team today.
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