New year, same old national press headlines: the end of the UK’s love for BTL; landlords selling up. And scaremongering on lettings agent fees.
Yet the news from lenders is very different. Indeed, many BTL lenders have actually begun 2018 with good news for landlords. For example, Paragon has expanded its range and removed the requirement of a floating charge on all applications from limited companies. LandBay, meanwhile, has opened up its BTL offering to first-time buyers in a significant move for the industry. They will be able to apply for a mortgage if they are employed and earning a minimum income of £85,000 — a sizeable salary by anyone’s standards but it is a step in the right direction.
Elsewhere, BM Solutions has made things easier for brokers with larger landlord clients with the launch of a portfolio calculator. Brokers can use it to calculate LTVs and rental cover ratios for portfolio lending.
Then there is Metro Bank, which has cut its rates, now offering 2.39 per cent on a five-year fixed mortgage.
Landlords are taking a positive approach too. New data from Accord reveals landlords have proved their resilience over the past 12 months, with 32 per cent of applications received by Accord Buy to Let coming from portfolio landlords affected by the new regulations.
Lenders deserve a pat on the back for the approach they have taken to combat such challenges, including the use of innovative product design and technological solutions to make things easier for landlords. And we should congratulate landlords for weathering the storm and pushing ahead with property investment.
However, it is worryingly easy to talk down a market; almost every financial crash or downturn has been made worse by media coverage and scaremongering. And we are in danger of seeing this happen in BTL.
So, brokers: spread the word that BTL is not dead; highlight the deals and rate cuts we are seeing from lenders; counteract the negative news with the positive things happening in the industry. Perception and confidence are as important as products and prices.
Ying Tan is managing director at Buy to Let Club