Outlook for the buy-to-let sector

Buy-to-let mortgage brokers are starting to feel more confident about the buy-to-let market as recent boosts to business give rise to some optimism. Paragon recently published its latest FACT index for quarter three, September 2020, which showed that nearly half of brokers (48 per cent) are seeing ‘strong demand’ for buy-to-let mortgages, up 22 per cent from June.

Nearly half of participants (49 per cent) expect to see more buy-to-let business in the next 12 months, up 8 per cent from June. Also, 89 per cent think that their business will be as strong or stronger than before the Covid-19 crisis, up 8 per cent from June.

It is good to see growing confidence among buy-to-let mortgage brokers, but elsewhere in the buy-to-let sector there is concern for the support being offered to tenants during this time. Although the furlough scheme has now been extended to December, questions arise over what further assistance tenants will receive after it ends if they are struggling to pay their rent and will landlords end up bearing the financial burden.

The National Residential Landlord Association (NRLA) has been campaigning for the Government to provide interest free, government guaranteed hardship fund loans for tenants in England to help them pay off Covid-19 related arrears. This type of scheme is already in place in Scotland and Wales. The NRLA also calls for landlords to be able to cover arrears by grants if tenants don’t take up a loan.

The impact of Covid-19 on the buy-to-let sector has been difficult for all parties involved, but there are indications that as the market recovers, confidence is growing and there is optimism for the future. However, there are still challenges to overcome before a real sense of normality returns.

Property Hawk Mortgages is here to help you make sense of all your buy-to-let mortgage options and to offer our experience and expertise to support you in finding the right product to meet your needs.

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