UK landlords want to invest further in property, survey finds

Landlords in the UK are so confident about the private rented property sector that three in five plan to expand their portfolios over the next six months, according to specialist mortgage broker Mortgages for Business.

The strength of the private rental market and the poor performance of property prices over the last year have given professional landlords and property investors the platform upon which to build their portfolio of properties, its inaugural quarterly Property Investor Survey shows.

While the majority of investors, 63%, will need to remortgage existing properties to fund their expansion, a similar proportion, 62%, believe lenders are not doing enough to support landlords and property investors.

One in five said that they feel that lenders should reduce their fees in order to support property investors. Some 18% believe lenders should increase LTVs and 15% feel that lenders should grow the number of case by case lending decisions rather than rely on computers and credit scores.

While four fifths, some 81%, of property investors intend on investing in vanilla buy to let property over the next six months, 22% plan on expanding their portfolios with Houses in Multiple Occupation (HMO) and 15% with Multi unit Freehold Blocks (MUFB), both of which provide higher average yields for investors.
 
Some 14% intend on investing in commercial or semi commercial property which also average higher yields than vanilla investments.

‘Although overall mortgage and lending to first time buyers is finally starting to increase, landlords remain confident about the future of the private rental market and plan to expand their portfolios over the coming months,’ said David Whittaker, managing director at Mortgages for Business.

‘However, more and more investors are exploring which options will give them the best returns on their investment. While vanilla buy to let properties remain popular, more complex deals are offering higher yields on average and are growing in popularity, particularly because of the shortage of housing stock currently on the market,’ he added.