BTL2021: Product transfers will become ‘very important’ in limited company BTL
Speaking at the Buy to Let Online Forum, representatives from Paragon and Aldermore noted that lenders would be increasing the range of product transfer for limited company borrowers.
Paragon national sales manager Jason Wilde highlighted that with rising costs in the market a cheaper refinancing option would be welcomed by landlords.
Responding to an audience question Wilde said: “Product transfers will be very important, certainly, with the drive in limited company lending we’ve seen.
“Refinancing buy-to-let properties can be very expensive at best of times, however when you factor in legals, the costs can spiral out of control.
“Certainly, product transfers and further advances can become very important in this marketplace. With product switches most lenders are realising the importance of this and we do at Paragon,” he added.
This was echoed by Matt McCullough (pictured), national sales manager at Aldermore, when quizzed about the difference in rates between limited company and standard buy-to-let products at some lenders.
He said: “Product transfers are a coming thing – people are going to start doing limited company product transfers.
“You’ll find in the main a lot of lenders do tend to price the same there.”
And product transfers have been incredibly important to the wider buy-to-let market over the last year, as Phil Rickards, head of BM Solutions noted.
“We all know product transfers have been the lifeblood of our industry through tough times, and particularly at the start of the pandemic lots of product transfer business was being written,” he said.
“We had our biggest ever year on product transfers last year, so that’s a strong part of the market.”
BTL2021: Mini-boom and ‘really strong pipelines’ give BTL market positive edge – Rickards
Speaking at the Buy to Let Online Forum, Rickards (pictured) emphasised that the market had proved remarkably resilient over the last year and was on course to remain so.
Rickards added that 2020 was BM Solutions’ biggest year for new business since 2007 and its largest ever year for product transfers.
He also praised chancellor Rishi Sunak for not targeting the sector for tax rises and for including landlords in the payment deferral scheme.
“Has there been a mini-boom? Yes, there has, aided somewhat by the stamp duty holiday,” he said.
“It’s great to see the chancellor, for one of the first times I can remember, giving buy-to-let a step up.”
He continued: “I’m sure we all would have signed-up for last year’s market of £37bn just down from £42bn the year before.
“Nobody really knows what’s coming, but my prediction would certainly be for a market in the high £30bns maybe even early £40bns as buy-to-let completions and pipelines still look really strong – a good start to 2021 already.”
When asked about whether BM Solutions would be following-up the growing interest in environmentally friendly mortgage options, Rickards said: “The green agenda is high on everyone’s agenda so this is something that I wouldn’t rule out in the future.
“We are currently focussing on finalising the roll out of our new system with PTs next to market soon.”
Rickards concluded his session with a positive note on the market.
“There’s never been a better time to be a mortgage adviser, landlords need your voice more than ever,” he said.
“I’m cautiously optimistic about the future of the buy-to-let market. It’s been through lots of challenges and landlords themselves have shown how resilient they can be.”
The Buy to Let Online Forum takes place tomorrow
The half day online event runs from 8.30am to 2pm and has an added new feature in 2021 – the ability to book one-to-one video meetings with BDMs and in some cases, underwriters too.
You can also interact live with our speakers after each presentation, visit sponsors on virtual stands, and network with colleagues.
Phil Rickards, head of BM Solutions, will kick off this year’s Buy to Let Online Forum with an overview of the current state of the market.
Rickards will begin a day packed with speakers from key players in the market to give mortgage advisers and intermediaries insight into the buy-to-let (BTL) sector.
He will be followed by speakers from several lenders including Paragon, Aldermore and Keystone and there will also be a panel debate.
Registration is still open, is free for intermediaries in the sector and can be accessed through the event website, as can the programme: https://www.mortgagesolutions.co.uk/events/buy-let-online
BM Solutions head Phil Rickards to give market overview at The Buy to Let Online Forum
Rickards (pictured) will begin a day packed with speakers from key players in the market to give mortgage advisers and intermediaries insight into the buy-to-let (BTL) sector.
He will examine how the UK BTL market been impacted by the pandemic.
And Rickards will look at how landlords and lenders have reacted, where the opportunities lie now and how advisers should be positioning themselves to best cater for landlord clients.
Registration for The Buy to Let Online Forum is open now and free for intermediaries in the sector.
The event is taking place on Wednesday 21 April from 8.30am – 2pm and includes a new feature to book one-to-one meetings with business development managers (BDMs) and in some cases, underwriters from attending lenders.
Other subjects being discussed include key regulatory and fiscal changes, the growth of houses in multiple occupation (HMO) and a lender discussion panel.
Attendees can also interact live with speakers after each presentation, visit sponsors on virtual stands and network with colleagues.
To book at one-to-one video meeting with a lender during one of the networking breaks, contact the AE3 Media team at firstname.lastname@example.org.
To register to attend for free please visit the event website: https://www.mortgagesolutions.co.uk/events/buy-let-online-forum
Talk to underwriters and BDMs at The Buy to Let Online Forum
The event is taking place on Wednesday 21 April from 8.30am – 2pm and includes a new feature to book one-to-one meetings with business development managers (BDMs) and in some cases underwriters from attending lenders.
Subjects being discussed include opportunities in the buy-to-let market, key regulatory and fiscal changes and a lender discussion panel.
Attendees can also interact live with speakers after each presentation, visit sponsors on virtual stands, and network with colleagues.
To book at one-to-one video meeting with a lender during one of the networking breaks, contact David Adjei from the AE3 Media team on email@example.com.
To register to attend for free please visit the event website: https://www.mortgagesolutions.co.uk/events/buy-let-online-forum
Rewind Wednesday – The Buy to Let Online Forum: Final Part
The final two presentations discuss what has changed in lockdown in how the market operates and how advisers have adapted, and then sees two of the biggest buy-to-let lenders put on the spot in the key issues of the moment.
Lessons from lockdown
Ying Tan, chief executive, Dynamo
Phil Rickards, head of BM Solutions and Adrian Moloney, managing group sales director, OneSavings Bank
In the first session, Ying Tan outlines how advisers have to adapt to keep their business relevant and successful in the current environment.
And in the panel debate, Phil Rickards and Adrian Moloney explain the challenges they have been facing handling cases since lockdown and where they see criteria changes coming.
Rewind Wednesday – The Buy to Let Online Forum: Part III
These two sessions consider research of the over-arching environment that landlords find themselves in and their plans for the future, and how landlords can take advantage of a diversified investment strategy. They are:
Broadening your horizons – and those of your clients
Paul Brett, managing director, Landbay
Covid-19 and the UK’s private rental sector
Mark Long, director of financial and business, BVA BDRC
In the first video, Paul Brett will discuss the understanding of shrewd investors that diversification is key, and in the world of buy-to-let, houses in multiple occupation (HMOs) and multi-unit freehold blocks (MUFBs) can offer great returns.
After that, Mark Long gives a detailed look at how the pandemic and resulting lockdown have impacted tenants’ position, and landlords’ confidence and outlook.
Rewind Wednesday – The Buy to Let Online Forum: Part II
The next two presentations focus on the wider strategies landlords can be taking and why the market is a positive place, despite the coronavirus restrictions. They are:
Strategies for success
Charles McDowell, managing director, specialist mortgages, HTB
Reasons to be cheerful – why the buy-to-let doom-mongers are wrong
Craig McKinlay, new business director, Kensington
In the first of these, Charles McDowell will examine how landlords can maximise their buy-to-let yield via specialist investments.
This includes discussing the pros and cons of investing in different property classes and the extra work that can be required.
In the second session, Craig McKinlay discusses why property still remains a valuable investment class.
Despite Covid-19 challenges, property investment remains a huge, tax-efficient opportunity in the medium to long-term and an attractive proposition given lender appetite and product supply.
Five winners revealed from The Buy to Let Online Forum prize draw
The winners were among the almost 1,000 people who registered for the online conference and exhibition which focused on the changing world of the buy-to-let market.
Presentations included Richard Rowntree, managing director of mortgages at Paragon, with his observations on how landlords and the buy-to-let market can weather the pandemic.
Landbay managing director Paul Brett discussed how to diversify a property investment strategy, while Hampshire Trust Bank managing director of specialist mortgages Charles McDowell talked about how to maximise buy-to-let yields.
Other talks came from Dynamo chief executive Ying Tan, Kensington Mortgages new business director Craig McKinlay, Aldermore, national sales manager for intermediary mortgage distribution Matt McCullough, and BVA BDRC director of financial and business Mark Long.
A panel debate between Phil Rickards, head of BM Solutions and Adrian Moloney, group sales director at OneSavings Bank, closed out the event.
The five winners are:
- Robert Denton, Regentia
- Brian Roberts, Malbon Townsend
- Keval Nagaria, KN Mortgage Management
- Sonja Roosten, Indigo Mortgage and Financial Services
- Hugh Dokter, Cavalier Financial Solutions
The AE3Media team will be in touch to let you know how to claim your prize.
The content from the forum is still available to view. Please contact firstname.lastname@example.org to get access.
For more information visit: https://www.mortgagesolutions.co.uk/events/buy-let-online-forum/?pfat=e103e0bc86d148eda1d842290bcf0d33
BTL2020: BTL remains attractive investment despite challenging climate
Landlord sentiment around capital gains, rental yields, the UK private rental sector as a whole and their own lettings businesses have all returned to above or close to levels recorded at the end of last year, after falling sharply in Q1.
Only feelings about the UK financial market have remained depressed.
Mark Long, director of financial and business at BVA BDRC, told the Buy to Let Online Forum its research found landlords’ main concerns were missed or unpaid rents, void periods and the ability to manage portfolios.
“Landlords confidence crashed [with the introduction of the lockdown] but there are early signs of recovery,” he said.
“More than half [of landlords] experienced rent problems or unanticipated void issues but landlords are helping where they can.
“One in five applied for a mortgage holiday and a similar proportion intend to do so in the future.”
For half of those who took one, the payment holiday was critical to their business continuity and Long noted there was “quite a lot of compromise to make things work for both parties”.
Around half of landlords approved rent deferments, while more than a fifth had agreed to rent reductions of more than 20 per cent.
There was positive news, with 28 per cent of landlords planning to remortgage this year – a figure unchanged from the end of last year, with most of these being portfolio and limited company investors.
However, Covid-19 debts will cast a shadow over next 12-24 months influencing market activity and future policy decisions.
Reasons to be cheerful
In his talk, Reasons to be cheerful, Craig McKinlay, new business director at Kensington, said brokers and landlords had lots of reasons to feel positive including the performance of buy to let compared to other asset classes, falling product rates and increased opportunities to advise to different segments of the market.
Presenting to property professionals at The Buy to Let Online Forum, McKinlay used an example of a £150,000 investment into shares listed on the FTSE All Share Index between 1995 and 2019.
Over that time, the investment would have grown by 67 per cent. If the same amount of money was used to be an unencumbered buy to let property, between those years, the property would be worth £325,000, an uplift of 116 per cent.
Landlords who used a mortgage to buy the property, which requires them to put less of their own money into the purchase, would see an even greater increase in their initial investment. “This is what we call leveraged investment,” said McKinlay. “And it also shows you the advantage of buy to let over shares.”
McKinlay also highlighted the expansion of several sub sectors within buy to let that created plenty of opportunities for brokers to grow their business. The numbers of older and younger landlords were increasing, he said during his talk, and products to serve both demographics were on the rise.
Falling rates, said McKinlay, were also another reason to be cheerful.
“Rates are still low and have fallen further since Covid as lenders look for solid low risk business,” he said.
“Although landlords have increasing costs in some way, more taxes for instance, and more regulation, the cost of having a mortgage has reduced. That has allowed landlords to maintain their profitability over the last few years.”
In the live chat, McKinlay hinted that Kensington would be announcing cuts to its rates shortly, following the announcement it had recently finalised a securitisation.
Registration is now open for brokers who would like to access presentations and content from the Buy to Let Online Forum 2020 which took place yesterday.
Email email@example.com to request access.