The implementation of the PRA’s new underwriting standards has just been completed and, understandably, much of the discussion in the sector is focused on the impact the new rules will have. Indeed, at our recent buy-to-let event in Bracknell, the effect of the PRA changes on everything from business levels to processing times came up for discussion.
Processing times in particular are a concern for those of us operating in the sector. With lenders required to ask for more information from landlord clients, relating to their entire portfolio and not just the property in question, it is almost guaranteed that the processing stage of an application will take longer than normal. In the fast-paced world of buy-to-let where property investors want to move as quickly as possible, this could be an issue.
One particular comment at our event stood out. When the panel was asked by an audience member what measures lenders were putting in place to ensure delays were minimal, panelist Roger Morris claimed the deciding factor would be brokers’ ability to upskill in terms of packaging the documents and data needed.
This point resonated with me because it showed the importance of the broker/lender relationship. The changes being imposed on the BTL market essentially affect lenders but, by working closely with brokers, they will be able to minimise any disruption to the client.
Indeed, the theme of co-operation and adjusting together to the changes came up a lot during the debate. As Morris rightly pointed out, we didn’t ask for the changes but, as an industry, we can meet them and produce a successful market if we all rise to the challenge.
On another note, while the sector is pulling together to ensure portfolio landlord clients are still able to access finance — and with relatively few problems — the mainstream media, it appears, are on a mission to talk down the market. Whenever there’s a slow news day, it seems the easiest thing to do is throw together a list of the changes affecting the landlord market and lament the end of BTL. Yet I sat at our event and heard how lenders were working hard to adjust to the changes and how investors were continuing to seek finance. There was none of that doom or misery the press seems to think radiates around our market now.
While the trade press may be speaking the truth, the problem is that it is the mainstream newspapers that landlords will get their information from. Those of you who speak with journalists on a regular basis, let’s please work together to set the doom-mongers straight.
Ying Tan is managing director of Buy to Let Club