The most significant trend since the launch
of Buy-to-Let has been the growth in the number of portfolio landlords. Letting agents and
lenders all report that private individuals who made their first property investment
through the Buy-to-Let scheme have been attracted almost immediately to the potential of
portfolio ownership.
However, the most interesting trend has been
the disappearance of the traditional inertia usually found in the mortgage market. New
landlords are searching out the most competitive interest rates and mortgage packages.
This has come about due to a greater understanding of the potential return on their own
capital and the rental income achievable.
As a result, many investor landlords now
re-mortgage both to gain more favourable rates and to raise further capital.
The range of investment mortgages has grown
along with the scheme and these all take rental income together with the conventional
financial factors into account. This has led to a ‘Standard Variable Lettings
Rate’, equivalent to or very close to ordinary standard variable rates.
As the Buy-to-Let scheme gains maturity, the
mortgage lenders have been able to devise and refine mortgage packages to suit most
circumstances and to cater for most foreseeable eventualities.
These packages include flexible mortgage
accounts to allow for the inevitable void periods between tenancies and a variety of fixed
rates covering various periods up to ten years.
There have been changes too for British
expatriates and foreign nationals attracted to investment property in the United Kingdom.
The criteria for lending to these categories
varies. Some lenders expect foreign nationals to have had an address in the UK for some
years. For others, it is simply a question of overcoming the long distance problems of
referencing and checking status.
Providing applicants live and work or have a
base in countries with an ‘Information Culture’ they should be able to
satisfy the status criteria needed. There should be little or no problem for British
expatriates and the lenders are accustomed to the value of citizens of the European Union,
Scandanavia, the United States and Canada.
ARLA agents increasingly are able to provide
a property search and acquisition service.
