Buy-to-let remortgaging on the up in second quarter

One of the biggest reasons for a landlord to invest in one of the highly rated products of Advanced Rent (http://www.advancedrent.co.uk), such as Rent Guaranteed, is so that they can enjoy greater financial security over the long term, enabling them to expand their portfolios. One indicator of a thriving buy-to-let market is greater mortgage availability, which is why many landlords will be encouraged by the news of an increase in buy-to-let remortgaging in the UK in the second quarter of the year, as more investors refinance to raise capital for future projects.

That is according to the Mortgages For Business Complex Buy to Let Index, which found that there was a rise in remortgaging as a proportion of transactions on all property types except vanilla during 2013’s second quarter. The firm said that the availability of buy-to-let mortgages had been boosted by the government’s Funding for Lending scheme, with rates being reduced and lenders encouraged to relax criteria. Prospective rent guarantee insurance policyholders will be encouraged by the 31 more deals on offer in the second quarter than the first, bringing the total to 465, despite the number of lenders – 27 – not changing.

Managing director at Mortgages For Business, David Whittaker, said that buy-to-let mortgages had never been so affordable following the downturn, stating that the assistance on offer from FLS had been “gratefully accepted” by lenders, as it had enabled them to pass on some of the savings to investors in the form of greater choice and more competitive rates. He added: “This has encouraged a record proportion of refinancing with landlords taking advantage of cheaper remortgage deals in order to expand their portfolios further down the line.”

That wasn’t the only good news for investors looking for a landlord rent insurance policy. Although most property types had seen a slight fall in yields, the outlook for yields was good and they remained strong. Whittaker added that even with first time buyer numbers seeing a slight improvement, the demand for rented accommodation remained “astronomically high”.

The survey recorded the biggest increase for semi commercial property (SCP), with the second quarter seeing remortgages account for 9 in every 10 transactions, compared to a mere 54 per cent in the previous quarter. Meanwhile, 88 per cent of all Multi-unit Freehold Block (MUFB) deals were accounted for by refinancing, compared to the first quarter figure of 75 per cent. In the first quarter, just 69 per cent of total Houses in Multiple Occupation (HMO) deals had been remortgages, but this jumped to 84 per cent in the second quarter. There was a slight fall for vanilla property by this measure, although the second quarter still saw refinancing account for 65 per cent of all vanilla transactions, compared to the first quarter figure of 69 per cent.

The overall picture, then, was a very positive one for landlords, and may further encourage many to become involved in a good rent guarantee scheme like that of Advanced Rent (http://www.advancedrent.co.uk).

Editor’s Note: Advanced Rent (http://www.advancedrent.co.uk) are represented by the search engine advertising and digital marketing specialists Jumping Spider Media. Email: info@jumpingspidermedia.co.uk or call: +44 (0)20 3070 1959 / +34 952 783 637.