A specialist lender has issued a positive outlook for the buy-to-let market, despite the raft of legislations threatening to drive many landlords away.
Paragon Mortgages, which has just posted a 14.2% fall in buy-to-let completions in the year to September, believes the market will pick up sharply. This is due to the fact more rental properties are required to meet demand.
Challenges
John Heron, director of mortgages at Paragon, noted: ‘Whilst the buy-to-let market has had a challenging year, we continue to see the potential the sector has to offer.’[1]
Mr Heron observes that 2016 has been a year of two halves for buy-to-let. Completion levels were very strong in the run up to the stamp duty increases seen in April, since when, as Heron says, there has been a ‘commensurate reduction in activity levels.’[1]
‘With strong rental demand, there will continue to be a growing need for professional landlords to provide quality private rental accommodation and with our 20 years’ experience in the market, we remain very-well positioned to work with these landlords,’ Heron stated.[1]
More professional landlords are need, claims mortgage lender
Autumn Statement
The challenges facing buy-to-let landlords are likely to heighten, following this week’s Autumn Statement. Many have been left frustrated with Chancellor Hammond’s failure to cut or amend stamp duty or the proposed mortgage interest tax relief.
However, the main move was to introduce a ban on letting agent fees. This has led to fears that these charges will be passed onto tenants, in the form of higher rents.
[1] https://www.landlordtoday.co.uk/breaking-news/2016/11/strong-rental-demand-means-growing-need-for-professional-landlords