New data from Paragon Mortgages, suggests that there is strong growth in the number of new BTL landlords entering the market.
The proportion of all buy-to-let cases from first-time landlords was 27% in the third quarter, up sharply compared with 22% on the previous quarter.
It comes as no surprise that the growth in first-time landlord buy-to-let business comes at a time when house prices are once again on the rise, and tenant demand for rental property is high.
Six out of ten mortgage brokers (56%) said they thought that the availability of buy-to-let finance had improved over the previous three months, and this would also enable new landlords to enter the market.
“First-time landlords have been an important source of growth at a time when more established landlords with larger portfolios have found themselves constrained by limited equity.
“Improved availability of finance is critical to the continued growth of the private rented sector and to meet the demands of renters”, said John Heron, M.D. of Paragon Mortgages.
As well as improved availability of finance and low interest rates, savings languishing in bank accounts earning little to no interest may be another driver for new landlords to enter the market.
However, while BTL profits may sound appealing, many new landlords are not aware of the many risks and pitfalls of investing in property. For example a landlord has to adhere to over 70 government statues and regulations in order to remain compliant!
That is where a professional lettings agent can be worth their weight in gold in supporting new and or/novice landlords.
“Ensure your chosen lettings agent belong to an association such as ARLA, NAEA, NALS, The Property Ombudsman, or Guild of Lettings. This ensures they uphold a certain level of service and means they will be insured against defaulting rent or deposits not paid into a scheme, for example. Ask to see their registration, check that it is up to date with the association and if needs be, go to the Association website.
Mr Shamplina said: “There are good companies out there with good products, like Northwood Lettings – companies with a good history and financial stability”.
All Northwood offices have recognised client money protection in place and is a founding member of SAFEagent, as this short video explains:
Gemma Goodson, C.E.O. of Northwood comments:
“Northwood was specifically set up to service the need of the novice landlord. We appreciate only too well the busy lives that people lead, and the level of support they need to run a compliant landlord business.
Northwood has always been about best practice and leading the way in raising standards in the Private Rented Sector and new landlords can trust us with their property and opt for our Guaranteed Rent Scheme for complete peace of mind”.
Northwood is one of the largest and most recognised lettings agents in the U.K. and the leading supplier of Guaranteed Rent to give landlords complete peace of mind.
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