Landlords look to bridging loan brokers to help them expand their portfolios

With no end in sight to the boom in the letting business, landlords are even turning to more expensive loans in a bid to expand their portfolios in time to take advantage of the present situation.

A report by bridging loan experts West One Loans says that more and more brokers are being approached by professional landlords keen to get buy-to-let loans but who have been turned away by High Street Banks. 98% of brokers interviewed said they were doing more business now with property investors interested in landlord insurance than they were at the beginning of the year.

Chairman of West One Loans, Duncan Kreeger, said the report conversely showed slightly fewer brokers thinking now was an opportune time for landlords to take on more properties but explained: “While there has been a fall in the number of brokers who are certain investors should expand their portfolios, the change is small – and 81% of brokers are still confident it’s a good time to invest in the sector. Furthermore, the number of brokers who think it’s definitely not a good time to pile into the market has fallen to less than one in ten. Landlords and brokers have different opinions of the market. While fewer brokers think it is a good time to invest in buy-to-let, high demand from landlords suggests they feel otherwise. Despite a slight cooling of broker sentiment towards buy-to-let as an investment for the future, thanks to the current demand from landlords, buy-to-let bridging is flourishing. Bridging is still not being affected by increasingly problematic conditions in the wider residential market. In fact, it’s thriving off the back of them.”

It is perhaps indicative of the confidence landlords feel that they are prepared to go for these expensive loans. Tenants are in plentiful supply in all areas of the country and they have virtually killed off competition from first time buyers who find it even more difficult to get a home loan from the High Street Banks. The result is residential landlords can drive a hard bargain with sellers when it comes to negotiating a price on a property, which in turn will reconcile the extra interest they are paying on their loans.

Leave a Reply