Speaking at The Buy To Let Forum in Bolton, Jason Berry (pictured), group sales director at Crystal Specialist Finance, said: “That cost of borrowing is making professional landlords really consider their options, and we are seeing some really different landlords.”
He explained that the firm was seeing more over-50s landlords starting to sell their portfolios as their assured shorthold tenancy came to an end, despite the fact that they may have to pay capital gains tax on such sales.
However, Berry added that there was an “underbelly” of 25 to 45-year old landlords who are looking to purchase. He noted that they typically tend to be more “professional” as they typically had a special purpose vehicle or limited company and they had “real appetite” and “real ambition”.
“You’ve got this opportunity to connect this 25 to 45-year-old segment, who are more professionally structured, with the older borrowers who are trying to dispose of stock. There’s a number of reasons for that, such as upcoming EPC legislation, increasing costs or maybe it has been a struggle to take possession of a property from tenants who are not making rental payments,” he explained.
Berry said that amateur landlords were not making a lot of purchases and this was due to a lack of stock.
Enquiries rising and portfolios diversifying
He continued that as a business in Q1 this year it had seen buy-to-let enquiries rise by 31 per cent and this was expected to grow as diversification was growing in importance.
Berry said landlords were increasingly looking to diversify asset and property type, especially larger landlords with “significant portfolios”, pointing to houses of multiple occupation as an example.
He continued: “The buy-to-let market is confused at the moment and confusion is a good thing. Confusion causes questions and uncertainty and causes a need for financial advice and for us to be engaged with customers.”
Berry said that landlords “needed help and guidance”, whether it was older landlords looking to dispose of properties or younger landlords looking to buy, and packagers like Crystal Specialist Finance could be part of a broker’s arsenal alongside referrals.
The Buy To Let Forum is continuing in Worcester, Cardiff and West Sussex. To find out more information follow this link.
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