BTLForum17: Private landlords expect market and portfolio expansion – Aldermore

A survey of private landlords carried out by Aldermore between January and mid-March, found that landlords have already begun to change the structure of their portfolios and put in place plans to protect their profits from a reduction in mortgage tax relief to take effect from April.

Charles McDowell (pictured), Aldermore’s commercial director, mortgages, shared the findings of the survey with brokers at The Buy to Let Market Forum in Bolton, yesterday. “It’s great to see a resilient and optimistic attitude among private landlords amid the doom and gloom headlines and raft of changes to their market,” he said.

Some 55% of landlords said they expected the total value of the buy-to-let market to increase in 2017, compared to 27% in 2016. Last year, buy-to-let lenders advanced £40.6bn of lending, the highest amount since 2007.

Meanwhile, 27% of respondents said they had planned to expand their portfolio of properties this year, up from 9% the year before.

When asked how they were going to do this, 49% said they would use finance while 50% said they would purchase with cash. Of the 49%, landlords looking for a mortgage accounted for 35% while 14% said they would capital raise by remortgaging an existing property.

Strategies to protect profits included charging more rent and restructuring the way properties were held within the portfolio. The amount of landlords who plan to raise rents in response to market changes rose from 14% to 27% year-on-year. Interest in using a limited company structure increased from 11% to 15%, while 9% said they would consider moving increasing their exposure to commercial property, or making the move into the commercial market completely.

See the latest Mortgage Solutions poll result on broker attitudes to limited company wrappers.