60% of landlords planning to expand portfolio in next 6 months

60% of landlords are planning to increase their property portfolios over the next six months, according to specialist mortgage broker Mortgages for Business. 

84% of investors looking to expand said they are planning to purchase more houses and flats (vanilla buy to let) by the end of the year, thereby increasing the supply of rental properties to help cater for demand which continues to outstrip supply.

Encouragingly, only 3% of investors are planning to reduce their portfolios over the next six months, down from 6% last quarter.

David Whittaker, managing director at Mortgages for Business, explained: “Landlord appetite for buying residential property is high. This will support the private rented sector and ease the strain on would be renters chasing too few properties.”

The research, which polled the views of 159 investors, showed complex buy to let property is becoming increasingly popular probably due to the more attractive yields compared to vanilla buy to let properties. 25% of respondents said that they were considering purchasing either HMOs, multi-units or semi-commercial property (or a combination of the three).

More than three quarters of landlords feel that lenders need to do more to support them and whilst it will come as no surprise that their main gripes were with rates, fees and LTVs, more interestingly landlords are looking for buy to let mortgages that cater for more specialist scenarios including more products for limited company applicants, products for holiday lets and more lending to ex-pats. Landlords were also interested in seeing more case-by-case underwriting rather than computer based lending decisions.

Just over half (54%) of investors who are planning to expand revealed they will need to refinance their existing properties. Of these, 20% are likely to struggle to secure finance because of a lack of equity, reflecting the dearth of high LTV mortgages in the market. As of June this year, there were only four 85% LTV mortgages available (from Kent Reliance).

8% of investors revealed they have been asked by lenders to refinance elsewhere, largely as a result of RBS which is looking to reduce its exposure to property and Bradford & Bingley which is looking to exit the market entirely.

David Whittaker commented: “Landlords are bullishly confident about the prospects of the buy to let market over the next six months. There are a huge number of would-be owners being displaced into the rental market every year, which has kept tenant demand sky high and pushed yields on private rental property over the 6% threshold.”


New apartments in Newbury with guaranteed rent for five years

UKPI have today announced the launch of a new development in Newbury, Berkshire.

The new scheme is a brand new block comprising just 10 x two bedroom purpose-built apartments, set over two floors. Situated in a quiet location on Sidestrand Road, in the heart of an established residential area, the site is surrounded by mature trees and attractive landscaping.

The development is conveniently located within easy walking distance to local schools and just over a mile from Newbury town centre and the railway station.

The location and design of these high specification apartments make them ideal for letting and investment. There is good rental demand in the area and a shortage of suitable property.

The spacious apartments have been designed to make the best use of space and light while creating a modern and comfortable living environment. Set over two floors, the development is located in a quiet and tranquil setting within an established residential area, surrounded  by mature trees, attractive landscaping and with ample parking.

Inside you’ll find well designed interiors making the most of natural light. Kitchens come with a range of modern appliances, all seamlessly integrated into beautiful and practical layouts. Bathrooms feature designer fittings, creating relaxing havens of white and chrome. Master bedrooms are complete with built-in wardrobes.

Prices start from just £165,950 and anticipated rents will be from £825 per month, providing a yield from 5.7%.

Richard Gordon from UKPI said: “We are delighted to be releasing these fantastic new apartments. This is an excellent block in a quiet and established residential area and at these prices we are expecting a great deal of interest.

“The scheme will be finished around the end of May and we already have interest from tenants, and a possible deal with a serviced apartment operator who will rent the entire block for five years. This could be a fantastic deal for investors as it means guaranteed rent, no voids and no management fees.”

To obtain further information, brochure and floor plans, click here.


Confident landlords plan porfolio expansion

Confidence among UK property investors is high as three in five plan to expand their portfolios over the next six months, according to specialist mortgage broker Mortgages for Business.

The strength of the private rental market and the poor performance of property prices over the last year has given professional landlords and property investors the platform upon which to build their portfolio of properties.

While the majority of investors (63%) will need to remortgage existing properties to fund their expansion, a similar proportion (62%), believe lenders are not doing enough to support landlords and property investors. The results come from Mortgages for Business’ inaugural quarterly Property Investor Survey in which landlords and investors were surveyed.

One in five (20%) feel that lenders should reduce their fees in order to support property investors. 18% believe lenders should increase LTVs and 15% feel that lenders should grow the number of case by case lending decisions rather than rely on computers and credit scores.

While four fifths (81%) of property investors intend on investing in buy-to-let property over the next six months, 22% plan on expanding their portfolios with Houses in Multiple Occupation (HMO) and 15% with Multi-unit Freehold Blocks (MUFB), both of which provide higher average yields for investors.

David Whittaker, managing director at Mortgages for Business, commented: “Although overall mortgage and lending to first time buyers is finally starting to increase, landlords remain confident about the future of the private rental market and plan to expand their portfolios over the coming months.

Source: propertytalklive.co.uk

ARLA calls for tax breaks for private landlords

The government should support growth in the private rented sector and remove barriers to further investment, says the Association of Residential Letting Agents (ARLA).

In a Budget submission to chancellor George Osborne, ARLA calls for landlords to be treated as entrepreneurial businesses for capital gains tax purposes, so that they can enjoy the same tax reliefs as other firms.

At the moment some landlords face bills of 28 per cent when they sell a property, which ARLA says prevents them reinvesting in the market.

It wants the government to allow landlords to take advantage of the roll-over relief available to other businesses and only charge capital gains tax on gains released from the business as a profit.

ARLA also wants the reform of stamp duty to remove the slab structure that it says unfairly distorts the market.

Ian Potter, operations manager at ARLA, said: “Demand for private rented housing continues to grow with 3.4 million tenants living in the private rented sector, an increase of over one million tenants since 2005.

“The tax system can be used by the government to incentivise investment in housing stock in the private rented sector and therefore improve the conditions in which those 3.4 million tenants live.”

Source: aboutproperty.co.uk

Skipton reduces rates with new range of buy-to-let mortgages

Skipton Building Society has today launched a competitive new suite of products for property investors with lower fees and rates reduced by up to 0.2%.

The range of two, three and five-year fixed rate buy-to-let products also aims to give buyers greater flexibility around fee choices.

They include a two-year Fixed Rate to 70% LTV, with an interest rate of 3.89% (was 4.09%) fixed until 30 April 2014, an application fee of £245 and completion fee of £2,250. It has an early repayment charge of 4% of capital repaid and interest to the end of the month.

The two-year Fixed Rate to 70% LTV (low fee option) has an interest rate of 4.29% (was 4.39%) fixed until 30 April 2014, an application fee of £245 and a completion fee of £750 (was £995). It has an early repayment charge 4% of capital repaid plus interest to the end of the month.

The three-year Fixed Rate to 70% LTV has an interest rate of: 4.29% (new to range) fixed until 30 April 2015, an application fee of £245, completion fee of £1050 and an early repayment charge of 4% of capital repaid plus interest to the end of the month.

The five-year Fixed Rate to 70% LTV has an interest rate of 4.59% (new to range) fixed until 30 April 2017, an application fee of £245, completion fee of £2,250 and an early repayment charge of  5, 4, 3% of capital repaid plus interest to the end of the month.

The five-year Fixed Rate to 70% (percentage fee option) has an interest rate of 4.89% (no change) fixed until 30 April 2017, no application fee, and a completion fee of 2%.

All these products revert to Bank Base Rate plus 4.45% (currently 4.95%), carry an over payments of up to 10% per annum without penalty and free legals and valuations available for remortgages.

These new products are available through the Society’s Skipton Direct customer service centre, branches and all intermediaries.

Kris Brewster, Skipton’s head of products said: “We recognise that landlords play a vital role in bringing competition and vitality to the struggling mortgage market as well as providing private letting options for the first time buyers of the future. That’s why we’ve worked hard to cater for their needs with a competitive and varied range of product options since re-entering this market a year ago.

“We’re constantly listening to customer feedback and these latest products reflect some of the features they’ve said they want, including a choice of fee arrangements as well as even more competitive rates.

“We’re also giving people more flexibility around their choice of product term with the same rate applicable to the two and three-year products, in return for a slightly higher fee for the longer term option.”

Source: propertywire.com