Confidence within BTL has taken a hit but it is up to the industry to inject some fresh energy and competitive ideas
The buy-to-let market is more exciting today than it has ever been. Despite some regulatory burdens on landlords, particularly those with larger portfolios, there is huge opportunity and increasing competition spurring things on. Some may see it differently but, for me, change is a good thing.
There is far more lender choice, keeping rates competitive, compared with eight years ago when the market was more of a duopoly. I do not expect that level of competition to decrease after the next wave of PRA changes in September – seen by many as a headache for portfolio landlords but a move that should go a long way to professionalise the sector.
Portfolio landlords will become an increasing source of business for intermediaries, offsetting smaller or first-time landlords who may see the market as less attractive now. Many lenders will offer a proposition to support portfolio landlords when the PRA change comes through, keeping that niche competitive too.
We may not see the volumes of business we experienced in the past, at least at first, but the market will be far less homogenised and that is what is exciting. As a marketer, it is important to identify niches.
The rule changes are reshaping things but, frankly, a vanilla market would be a threat to intermediaries. Now more and more landlords are contemplating limited companies and need broker support to ensure they make the right decision for their portfolio size.
Admittedly, confidence within the landlord market is much lower than in the past. The constant changes to tax regulations as well as ongoing economic and political uncertainty do not help to alleviate concerns.
However, it is now up to the industry to inject some fresh energy and competitive ideas into the market in order to bolster it, and to rise to new challenges as positively as we can.
Jeff Knight is director of marketing at Foundation Home Loans