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It’s no secret that the plethora of regulatory and tax changes in recent years has dramatically changed the shape of the buy to let landscape.


The introduction of the Stamp Duty surcharge, the reduction in tax relief, tougher affordability and stress-testing by lenders, the proposed removal of Section 21 notices and the Tenant Fees Act coming into force have all had an effect on investors.


It seems that whenever something new is introduced, it’s met with a round of stories in the media about how the buy to let industry is dead and that landlords are looking to jump ship.


However, as with everything in life, there are always two sides to every story. Whilst it’s true that a large number of ‘casual’ landlords have decided that buy to let is not for them and opted to exit the market, what I believe is happening is simply a resetting of the sector as it adjusts to the new reality.


What we’re seeing is the market becoming more professional as investors look to spread their capital more evenly and minimise mortgage costs. We’ve seen a big increase in the number of landlords who are using limited company structures to run their buy to let business or who say they intend to use a limited company to buy their next investment property.


These investors are also exploring other ways to create value, rather than the standard single let property. More of them are seeking more profitable properties to replace those that have been or are being sold: we’ve seen a big uptick in the popularity of HMOs, holiday lets and multi-units over the past couple of years.


Another area that continues to see increasing activity is the number of landlords opting to purchase sub-standard properties at a lower market value then adding value by completing refurbishment work, ultimately improving yields by attracting quality tenants to help maximise the rental income possible.


As the UK’s leading specialist lender1, we understand the importance of developing products and criteria which meet customers’ changing needs in an evolving market. Supporting landlords as they develop and reshape their portfolios is our ethos.


While the market has certainly changed, there are still plenty of opportunities out there for brokers and their customers, as well as lenders prepared to help them achieve their investment goals. Buy to let has always been a resilient sector and it is likely to remain as such. I firmly believe that the outlook for the market looks sets to remain positive throughout the remainder of 2019 and into 2020.




Why not book a telephone or site meeting with one of our experts? They’re ready to share even more hints and tips on how you can diversify into specialist lending. Call us on 01277 508951 Option 1 then 3 to book in.


Sources: 1 BVA BDRC Project Mercury Report Q2 2019