Landlords are keen to buy but funding is tough
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The number of landlords planning to buy residential property for investment purposes has nearly doubled, according to Paragon Mortgages.
Paragon’s Trends research, a quarterly panel survey of landlords, shows 21% of landlords planning to purchase property during the third quarter of the year.
That is up from 11% who said they planned to purchase during the first quarter and 12% who planned to purchase in the second.
Almost three-quarters of landlords are planning to buy terraced housing, with th next most popular being semi-detached, flats and detached.
John Heron, managing director of Paragon Mortgages, says: “There has been a significant jump in the percentage of landlords looking to purchase property, which reflects the increased level of confidence across the landlord community”
But four out of 10 landlords say they made an attempt to secure by-to-let mortgage finance in the second quarter of 2010.
Of those 52% say it was harder to secure finance than before and only 13% saying it was easier and 35% claiming no difference. with just 13% stating that it was easier.
Nearly half say wider mortgage finance would encourage them to expand their portfolios, followed by better tax incentives at 43% and sustained levels of tenant demand at 42%.
Heron adds: “Accessing mortgage finance remains difficult for a large number of landlords.
“If the market, and the private rented sector, is going to expand, then criteria needs to be adapted to allow larger-scale landlords to grow their property businesses.”
