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Buy-to-let market is stagnant but will improve: MS Leaders

Buy-to-let market is stagnant but will improve: MS Leaders 1024 576 NGI Residential Mortgages

The buy-to-let market is “stagnant and does not have enough new property being made available”, said a selection of voices at the Mortgage Strategy Leaders Forum event, adding that the future, nevertheless, looks bright.

The panel, discussing ‘making buy-to-let work for your clients’ comprised of Lucy Barrett, managing director at Vantage Finance, Sarah Kelly, head of private finance and SPF Property Finance, Jeni Browne, sales director at Mortgages for Business, and Adrian Moloney, sales director at One Savings Bank.

Mortgage Strategy editor Gary Adams opened the panel by asking if it were true that “regulatory and political pressures have made the BTL sector much more difficult to navigate profitability in recent years, but if there is still money to be made?”

Moloney started the session by confirming that there is still good income to be made despite the lack of new BTL properties coming onto the market.

He said that a contributing factor to why the BTL market is flat currently is largely down to stamp duty charges.

Barrett said that she expects to see more movement in the market after the Brexit decision, which – and something that Browne was of the same opinion – is adding uncertainty that borrowers are hesitant to act within.

Barrett added that in the BTL market, product numbers are currently at pre-crisis levels, hovering at around 2,000. Moloney replied that this high number of products is having a positive effect on the broker market.

He added that the sector has proved how robust it is over the last few years, having survived a raft of regulatory changes, and that it should weather any potential political storm.

Working in the high-net-worth area of the market, Kelly was able to provide deeper insight in activity in prime property. She said that there had been a sharp increase in the number of international borrowers purchasing BTL properties recently in part due to the dramatic drop in the pound since the 2016 referendum. This was especially true of American and Chinese clients.

* Content Source – Mortgage Strategy.