Buy-to-let lending shows signs of recovery
Residential landlords across Britain may soon have the upper-hand when it comes to purchasing properties and turning them into rental units. According to a report in the London Times, there is a noticeable change in attitude on the part of financial institutions and other lenders, as they are showing much greater willingness to provide experienced landlords with buy-to-let loans than at any other time over the past two years. In fact, Whiteaway Laidlaw-affiliated with the Manchester Building Society-is targeting residential landlords with an average of two to three properties, in order to provide them with the funding that might help expand their business.
The emphasis is very clearly on experienced and tested landlords, rather than first-time homebuyers or novice investors, as the former group is least likely to default on their loan. In fact, Whiteaway Laidlaw is focusing on landlords 30 years of age or older, so as to provide the most experienced with an advantage when it comes to obtaining buy-to-let loans.
Mark Clare, who serves as the chief executive of a prominent home construction firm, told The Times that there is a noticeable rise in the number of buy-to-let loans available. But there is some concern that this clear preference for established landlords would lock new buy-to-let investors, as well as first-time homeowners out of the real estate market. Yet even now, the proportion of buy-to-let loans remains a small minority of all mortgages. Most recent statistics place this figure at just 6 percent, down from nearly 12 percent in early 2008.
RLA News 18/1/10