Certainty is key for buy-to-let investors

I don’t think anyone in the mortgage industry needs reminding that time is money. The market has bounced back from the pandemic with demand jumping by around a third annually, according to latest figures from Rightmove. 

Meanwhile, supply remains sorely low, so buyers need to be in a position to act fast or risk missing out. In fact, according to estate agent Chestertons, house hunters wanting to buy a property in London this year are likely to face more competitive market conditions than in 2021, which of course benefitted from the stamp duty incentive for at least part of the year. 

The estate agent said that since January, 51% more buyers have entered the market and there have been 35% more viewings than the same period last year. This environment of competition is especially pertinent in the buy-to-let space where competition for suitable properties can be even more fierce. 

Investors who have held back during the pandemic are now realising the extent of opportunity on offer from the market.  Demand for rental homes is up by a huge 76% compared to the same period in 2021 and average rents have increased by 8.3%, according to Zoopla.

Landlords who are ready to come back to the market need to work in partnership with their brokers if they are to add the best properties to their portfolios. Good advisers can put their clients in the strongest possible position in this rapidly moving climate by quickly arming them with information needed for purchase.

This enables investors to confidently go forward knowing how much they can borrow and secure properties ahead of the competition.  Of course, it’s not just in the buyers’ interest to avoid wasting time. Fact finds and applications that fail to make it through to completion cost brokers too. The less time that is wasted, means there is more room for developing relationships and really adding value.

Lenders can help you achieve this. For example, some buy-to-let lenders have the tools to help brokers get access to the desired information as easily as possible. 

For example, at Monument, we have recently launched a calculator on our website that can prove invaluable in providing quick and clear indications on borrowing. Knowing how much a client can borrow at the outset helps brokers to provide certainty, which is particularly important in specialist buy to let. 

Arranging mortgages on large portfolios and investments on properties such as HMOs can be rewarding, but they can also be more complex, making it all the more important to have clear and concise information from kick-off. 

Calculators are a quick and easy way for brokers to determine what a client can borrow before a decision in principle. These calculations can be invaluable when investors need to make fast decisions and advisers who don’t use these tools risk working with one hand tied behind their back and missing out on the full market recovery.

Conor McDermott is head of lending at Monument

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