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Why landlords should be confident about the future of buy to let – Moloney

by: Adrian Moloney, Group Sales Director, Kent Reliance for Intermediaries
  • 11/11/2021
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Why landlords should be confident about the future of buy to let – Moloney
If, as the saying goes, a week is a long time in politics, then the past year in the world of buy-to-let (BTL) has felt like an eternity.


Although there were tentative signs of a recovery this time last year, we were a long, long way away from where we were before Covid-19 hit. Two in three investors still believed their rental business would be negatively impacted the pandemic, it got as high as eight in 10 at the end of Q1 2020, and a fifth of landlords were experiencing an increase in voids.

However, just over a year on, it looks as though the recovery is now in full swing, with the impact of the pandemic less than initially feared. Not only that, landlord confidence levels are at the highest they’ve been in five years and tenant demand is soaring.

According to the latest research by BVA BDRC, just half of landlords say their letting business has been negatively affected, considerably lower than the 81 per cent who feared this would be the case in Q1 of 2020.

The research also shows that landlord confidence in rental yields has reached 57 per cent, a 20 per cent increase year-on-year and the highest level since 2016. It’s a similar story across all other key indicators, including landlords’ own letting businesses, capital gains, the UK financial market and the UK private rental sector, as well, with confidence at the highest levels since 2017.

Meanwhile, the proportion of landlords reporting an increase in tenant demand is at an all-time high. Almost six in 10 landlords have seen demand rise in the past three months, with nearly a third saying demand has increased significantly.

And the demand is not just confined to one area – all regions have seen a rise, with only those landlords in Central London not seeing a significant increase.


Specialist lenders vital to recovery

To help keep this recovery going, and ensure landlords can access the BTL mortgages they need – especially if they’re struggling to find products on the high street – it’s vital they know there are lenders out there who can help.

Borrowers who have less than perfect credit profiles or are self-employed workers, for example, might benefit from the expertise provided by specialist lenders who offer a manual underwriting approach. These type of lenders are perfectly placed to support more challenging cases as they have the ability to assess each case on its individual merits and can provide solutions based on a customer’s individual circumstances.

Although it’s impossible to predict what’s around the corner, hopefully we’ve now weathered the worst of the Covid-19 storm. With renewed confidence, and with the support of the right lender behind them, landlords have every reason to be confident about the future of their buy-to-let businesses.

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