B2L is still viable in the short term, say lenders
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Buy-to-let will be the main pillar of the specialist lending sector in the short term, according to lenders.
Speaking at Mortgage Intelligence’s annual conference in Hertfordshire last Tuesday, Chris Gowland, acquisition director at Lloyds Banking Group, told the audience that renewed confidence in house prices will be pivotal to restoring buy-to-let lending.
He says: “We see buy-to-let as the key pillar of the specialist market in the short term. The sector has contracted significantly and there arerelatively few lenders left but we are one of them.
“Lenders coming back into the sector will help but I also believe confidence in rental yields and house price inflation will be critical for buy-to-let lending to get anywhere near where we would like it to be.” James Chidgey, senior manager of corporate accounts at Nationwide for intermediaries and The Mortgage Works, also addressed delegates at the conference.
He says: “When securitisation fell out of bed, unfortunately so did the buy-to-let market. I think its prospects are good but we need more lenders, more funding and a resurgence of the sector.”
Chidgey says that compared with Europe the UK has a small rental sector. He adds: “With the mobility of labour across Europe we have a lot of Europeans coming to live in this country and they are not used to owning property. We might be about to see a fundamental shift in the pattern of property owner ship in the UK.
“For many years ownership has been around 70% but we could see that fall as renting is increasingly seen as a better option.”
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