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Still good business in buy-to-let deals

There has been a lot of talk about the buy-to-let market in the last couple of weeks.

Topics covered include buy-to-letters walking out and leaving properties abandoned and the fact that the number of repossessions are sky rocketing as a result.

We could be led to believe that demand for rental properties has disappeared but nothing could be further from the truth.

Leadbay has actually seen a 65% increase in the number of borrowers seeking advice on buy-to-lets as they look for advice of their existing mortgages – and some even feel that now is a good time to start buying again.

Investors are more realistic, too, with the average mortgage requested now just £115,000, down 18% from the £142,000 they asked for a year ago. Property prices have fallen too, of course, but only by 12%. According to Leadbay borrowers, the average buy-to-let property is now worth £189,000 as opposed to £215,000 this time last year.

Proportionately, therefore, LTVs have dropped by 8% with the average just 67% now, which should make business easier to place.

For those of you interested in what sort of people you’ll be dealing with – two-thirds are men, and the average age has risen by two years to 42.

For anyone still keen to talk to people needing buy-to-let advice it’s good news – the cost of acquiring leads is now averaging less than a fiver compared with over £10 last year, so if you can place the business your profit margins will be considerably higher.

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