Octopus returns to buy-to-let mortgage market

The lender withdrew from the market temporarily in November 2018 but after rejoining it then pulled out in March 2020.

It has now returned “in response to the growth opportunity in the BTL market, which is becoming increasingly evident over the last few months”.

“With people’s working and living arrangements changing as a result of the Covid-19 pandemic, investment into BTL property has expanded beyond the traditional urban hubs to suburban areas, creating an opportunity for brokers and borrowers,” it said.

Octopus is offering a maximum of 75 per cent loan to value (LTV) on two and three-year fixes at 5.49 per cent up to £1m and up to 65 per cent LTV for loans more than £1m.

A five-year fix is available at 5.99 per cent at up to 70 per cent LTV for loans up to £1m and at 65 per cent LTV for larger loans.

Loans are available between £50,000 and £3m, and Octopus will accept short term lets, houses in multiple occupation (HMOs), semi-commercial and multi-unit freehold blocks at a maximum of 70 per cent LTV.

Expats, foreign nationals, first-time buyers and those with adverse credit are also eligible but reduced LTVs may apply.

The product will be available to all brokers, has no minimum income requirement and will be available for properties in England and Wales.

‘Right time to return’

D’mitri Zaprzala (pictured), head of residential at Octopus Real Estate, said: “We have always been committed to the buy to let market and now is the right time for us to return.

“We have spent the last few months speaking to and listening to our broker community to understand what they really want from a specialist lender.

“We found that brokers want a lender who is dependable, so we have put this at the heart of our product, which can support complex cases and address the underserved part of the market.

“The buy to let market is buoyant, driven in part by the resilience of the housing market during the pandemic, and we see a significant growth opportunity as people re-evaluate their living arrangements as we start to emerge from this latest lockdown,” he added.

Steve Matthews, head of buy-to-let sales at Octopus Real Estate, noted that the pandemic’s impact meant there was a clear opportunity for the buy-to-let market to unlock alternative homes for people.

“However, many borrowers are missing out on the opportunity as they don’t meet mainstream lending criteria,” he said.

“We want to change this. Working in partnership with our broker community, we think there is an exciting opportunity to grow the market and reach those underserved borrowers to allow them to take advantage of external market conditions.

“We’ve worked hard to develop a product that will enable us to deliver through popular transaction times and help a wide range of borrowers become landlords, realising the potential of a BTL investment.”