View more on these topics

60 Seconds with…

Paul Howard
Head of Corporate Accounts
Nationwide Building Society

With first-time buyers finding it hard to get on the housing ladder, what impact will this have on the buy-to-let market?
It’s putting more demand on the private rental sector and we are seeing lenders make their products more attractive in response. The Mortgage Works recently introduced 80% LTV deals, which was enthusiastically received by the market.

Will LTVs rise further?
I don’t think so – at least, not for a while. We’ve probably already surprised a few people by moving to 80% LTV. Readers will know that we are a pretty cautious creature in buy-to-let but we thought it was the right time to do this. It’s a shot in the arm for the housing market and the intermediary sector too. I think we will see a general easing of criteria but not go back to some of the outrageous things seen in the market back in 2007.

Research from Datamonitor shows that TMW and BM Solutions did the bulk of buy-to-let business last year, so has lack of competition been a concern ?
Not at all. We’ve always been clear about the direction in which we want to steer our business and as a result we have a buy-to-let book that’s performed exceptionally well throughout the economic cycle. The model is thoroughly tested and we’ve been able to fulfil our lending ambitions. So we’ve had some challenges but overall, this has been a good period for us.

With the likes of Kensington, Precise Mortgages and Aldermore getting into buy-to-let lending, is this is a sign of growing confidence in the sector?
Yes, the sector has performed well as seen in recent Council of Mortgage Lenders arrears statistics. And the Association of Residential Lettings Agents says yields are increasing too. Margins are good and credit standards are tighter than they have been recently from a lending perspective so it’s an attractive proposition. But of course, any prospective lender still has to get funding which isn’t easy.

What impact will Capital Gains Tax changes have?
They could have some negative effects – it depends whether people are looking to acquire property for capital growth or for income opportunities. It’s probably usually a mixture of the two.

That said, there are several factors in play that outweigh the negatives of CGT changes. Low interest rates make buy-to-let an attractive proposition, house prices have stabilised and there is increasing demand for rental properties. These positive factors will outweigh the downsides of any changes to CGT.


OFT to investigate how tough it is to get ahead in retail banking

The Office of Fair Trading is to investigate barriers faced by new entrants or those wanting to enter the retail banking sector, and for smaller banks looking to expand. The OFT has published a paper calling for evidence on the barriers to entering, expanding and leaving the retail banking market and how these might affect […]

Criticism of FSA’s approved persons plan is overblown

While I have the greatest respect for Robert Sinclair and everyone at the AMI the suggestion that the FSA’s approved persons assessment could mean brokers with minor credit blips are excluded is overblown. The FSA has always asked questions about credit histories and criminal convictions – including drink-driving – as part of its approved persons […]


Movers and shakers

Portillion makes three appointments to its top team Portillion, formerly known as Checkmate Mortgages, has made three additions to its senior team. Jim Coleman (pictured) has been appointed treasury director, Will Foster has joined as financial controller and Helen Bramham has been named as oper- ations manager. Coleman previously held senior roles at Nationwide Building […]

Paul Walshe

Don’t take upturn for granted

Indicators in the US point to a possible commercial lending crisis so in the UK we should hope for the best while preparing for the worst, says Paul Walshe, partner and head of lender services at Moore Blatch


News and expert analysis straight to your inbox

Sign up