BROKERS URGED TO TACKLE SPECIALIST BUY TO LET AHEAD OF MARKET CHANGES

Peaking at the first leg of The Mortgage and Protection Event in Southampton, Bramham, director of mortgages and buy to let, (pictured) said falling rental yields in some parts of the country meant landlords were looking to Houses of Multiple Occupation to improve the profitability of their portfolios.

“This is a truly specialist market’, he said but added intermediaries should not be scared of moving away from vanilla into complex buy to let.

Cuts to landlord tax relief are due to be phased in from April 2017 which will see relief fall from its maximum level of 45% to 20%. Braham said this would hit portfolio landlords hard driving them towards Special Purpose Vehicle (SPV) mortgages to shelter themselves within the wrapper of a limited company. But, he added, the number of providers of this mortgage type was limited.

Intermediaries were reminded to check they had the correct permissions from the Financial Conduct Authority ahead of the March 2016 deadline when the consumer credit industry falls under FCA regulation.

“The applications are tough,” said Bramham. “We got ours approved in six weeks but we are hearing of some instances where the regulator is taking up to nine months to issue intermediaries with permissions, so don’t leave it too late.”