NetRent Mortgages Update
The buy-to-let mortgage market has expanded considerably over the last 12 months and there are now more lenders and products for landlords to choose from. This means that NetRent Mortgages can provide an even wider choice to landlords, with up to 400 mortgage products available at any given time.
The buy-to-let mortgage market has expanded considerably over the last 12 months and there are now more lenders and products for landlords to choose from. This means that NetRent Mortgages can provide an even wider choice to landlords, with up to 400 mortgage products available at any given time.
For standard buy-to-let investment – flats
and houses rented to families and professionals – there is a wide selection of
lenders and products currently available. The level of competition in the
marketplace and low bank interest rates has resulted in some good deals being
offered to landlords.
Lenders have also started providing special
deals to landlords which are available exclusively through selected brokers
only. These products are often highly competitive, designed for specific
customer lending requirements and may only be offered for a limited time. The
provider of NetRent Mortgages has been chosen by a number of lenders to
distribute this type of targeted product and currently has a range of special
deals on offer. These include buy-to-let mortgages with Hinckley & Rugby
Building Society, Leeds Building Society, Accord Mortgages, Kent Reliance, Skipton
Building Society and Mortgage Trust.
For landlords who
would like to release equity from existing buy-to-let properties to expand
their portfolios or move on to a more competitive interest rate, there is a
good choice of remortgage products available. There is a wide selection of
fixed and variable rates on offer, including deals with incentives such as free
valuations and no legal fees. With high rental yields and strong tenant demand,
it could be a good time for landlords to consider expanding their
portfolios with further buy-to-let properties.
Professional landlords often consider
houses in multiple occupation (HMOs) as viable investment properties and with
good reason. NetRent Mortgages’ latest Property Investor Profile showed that
terraced houses with student tenants (often HMO properties) command the highest
average rental yields – 8.23% compared with 6.60% for an average buy-to-let
property. Purchasing an HMO property can make real financial sense for
landlords.
For larger HMO properties, Paragon
Mortgages has a dedicated range of products offering a degree of flexibility on
up to 20 units. Products are available up to 75% LTV.
Kent Reliance is perhaps the most
innovative lender in the HMO segment, also offering a multi-let range of
products. Kent Reliance is currently the only lender in the buy-to-let mortgage
market offering loans up to 85% LTV, and this includes their HMO range. So for
landlords looking for a higher gearing, Kent Reliance is the go-to lender. It
will consider properties with up to 8 bedrooms and with multiple ASTs, although
there is a limitation on the minimum property value of £250,000.
The outlook for 2013 is positive for residential
property investors as it is expected that the buy-to-let sector will remain in
good shape during the next year. Average rents are still strong (over £1000 per
month according the PTM’s Property Investor Profile for Q3 2012) and tenant
demand is high. Good rental income and flat house prices means that landlords
are currently experiencing excellent average rental yields (6.60% during Q3
2012 according to the PTM Profile) and this is likely to continue in 2013.
However, investors looking for a new
buy-to-let property should carry out their research carefully first, as rental
yields can vary considerably according to property type, tenant type and
region. For example the PTM Profile shows that terraced houses provide the
highest rental yields at 7.28%. Students in terraced houses on average provide
a rental yield of 8.34%. Given that the average rental yield overall was 6.60%,
landlords may look to the student segment of the rental market to maximise
their returns. As with HMO properties, Paragon Mortgages and Kent Reliance are
the leading lenders for student lets.
It is likely that the general availability
of buy-to-let finance will continue to improve over the next few years. We are
expecting total new buy-to-let lending in the UK to be circa £15.5bn in 2012 and
this could increase to as much as £18bn during 2013, perhaps reaching £20bn by
2015.
It is possible that some new lenders will
enter the buy-to-let mortgage market in 2013, bringing more competition and
greater product innovation. Also, the government ‘funding for lending’
initiative could give banks and building societies further scope to provide
more buy-to-let mortgages as their total overall level of lending increases.
High tenant demand, affordable properties
and good rental yields means that buy-to-let property is currently an
attractive prospect for landlords looking for a medium to long term investment.
The availability for buy-to-let finance is improving and the general outlook
for residential property investors in 2013 is encouraging.
NetRent
Mortgages offers buy-to-let mortgages from the whole of the market and is an
excellent place to start your search for a product to suit your individual
requirements. Click here to visit our Mortgages Page.
