Paragon Bank research shows tenant demand at five year high

Paragon Bank, the specialist lender, has released its latest research, with over 750 landlords surveyed on its behalf by data group BVA BDRC. The results show the number of landlords reporting higher tenant demand is at a five year high.

Nearly 39% noted an increase in tenant demand over the last quarter, with 18.2% reporting it grew ‘significantly’ and slight increases reported by 20.3%.  This is an 8% rise from the last quarter, and the highest rise since 2016.

The survey revealed a 2% dip in the number of landlords reporting a fall in tenant demand compared to the last quarter.  Those unsure about current levels of tenant demand fell by 3%.

All regions of England and Wales, bar London, saw an increase year on year of landlords reporting a ‘significant increase’ in tenant demand. The biggest rise was for Yorkshire and the Humber with 65% reporting an increase, 28% significantly and 37% slightly.  Wales and the South West followed where an increase in tenant demand over the past three months was noted by 64% and 63% of landlords respectively.

Moray Hulme, director of mortgage sales at Paragon Bank, said: “It’s great to see that tenant demand reported by landlords to hit the highest level since 2016.

“Quarter two of 2020 was a time of real uncertainty and this was reflected in the record low levels of demand that landlords saw.

“Demand bounced back the following quarter and has been rising ever since. This highlights resilience of the private rented sector and suggests that a growing number of people have turned to it at a time when the stability of a good quality home is ever important.”

Original article featured here…

In April, Paragon released survey results showing the percentage of mortgage brokers who anticipated higher levels of buy-to-let business over the coming year was at a high not seen since 2014.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/paragon-bank-research-shows-tenant-demand-at-five-year-high/

Nationwide house price index shows cooling in UK house price growth

The latest Nationwide house price index has been published, showing a cooling off period for annual house price growth in July.  Although it fell, it did remain in double digits, at 10.5%.  In June, 13.4% was recorded, the highest for 17 years.

Prices have decreased 0.5% month on month.  Whilst not the only contributing factor, stamp duty changes have certainly made an impact on these figures.

Robert Gardner, Nationwide’s chief economist, said: “The modest fallback in July was unsurprising given the significant gains recorded in recent months. Indeed, house prices increased by an average of 1.6% a month over the April to June period – more than six times the average monthly gain recorded in the five years before the pandemic.

“The tapering of stamp duty relief in England is also likely to have taken some of the heat out of the market. The stamp duty changes drove the number of housing market transactions to a record high of almost 200,000 in June as home buyers rushed to beat the deadline. This was around twice the number of transactions recorded in a typical month before the pandemic and 8% above the previous peak seen in March.

“While tax changes have been important in determining the timing of transactions and the trends noted above, they have not been the main factor prompting people to move in the first place. Amongst homeowners surveyed at the end of April that were either moving home or considering a move, three quarters said this would have been the case even if the stamp duty holiday had not been extended beyond the original March 2021 deadline.

“Shifting housing preferences appear to have been the more important factor in driving the increase in housing market activity, with people reassessing their housing needs in the wake of the pandemic. At the end of April, 25% of homeowners surveyed said they were either in the process of moving or considering a move as a result of the pandemic. Given that only c5% of the housing stock typically changes hands in a given year, it only requires a relatively small proportion of people to follow through on this to have a material impact.

“Interestingly, the ‘savings’ from the stamp duty holiday have been dwarfed by the impact of recent house price gains. For example, the price of the typical UK property increased by around £24,500 between July 2020 the end of June this year, whereas the stamp duty saving on that property for a home mover (in England) was c£1,900. For a £500,000 property that saw the same average increase as the typical property over the same period, the comparable house price increase was c£57,000 against a stamp duty saving of £15,000.

“Underlying demand is likely to remain solid in the near term. Consumer confidence has rebounded in recent months while borrowing costs remain low. This, combined with a lack of supply on the market, suggests continued support for house prices. But, as we look toward the end of the year, the outlook is harder to foresee.

“Activity will almost inevitably soften for a period after the stamp duty holiday expires at the end of September, given the incentive for people to bring forward their purchases to avoid the additional tax.

“Nevertheless, underlying demand is likely to soften around the turn of the year if unemployment rises, as most analysts expect, as government support schemes wind down. But even this is far from assured. Even if the labour market does weaken, there is also scope for shifts in housing preferences as a result of the pandemic to continue to support activity for some time yet.”

Gareth Lewis, commercial director of MT Finance, commented: “Despite the end of the full stamp duty holiday, house prices haven’t fallen off a cliff. Consumer confidence is still relatively high; buyers haven’t got to the end of June and said they are not going to proceed with a purchase any longer. Those who couldn’t meet the deadline are still continuing in order to take advantage of the reduced stamp duty savings before the end of September.

“Transaction volumes will have fallen so a slight softening in prices is inevitable. Many solicitors are now taking much-needed holidays after putting in long days over the past couple of months, with less pressure to get deals over the line. August’s figures could well fall again because of the time of year, with many people trying to get away on holiday.

“It will be interesting to see what happens in September, and whether that final push to take advantage of the tail end of the stamp duty holiday will provide some further stimulus to get over the line, keeping prices high.”

Original article featured here…

MT Finance recently introduced a green properties incentive, for borrowers who attain an Energy Performance Certificate (EPC) of either A or B on their property.  Both new and existing borrowers are eligible for this scheme and it applies across the whole product range.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/nationwide-house-price-index-shows-cooling-in-uk-house-price-growth/

Landbay reduces rates and adds large loan mortgage

Landbay, the buy-to-let lender, has launched new products including a large loan mortgage and lowered rates for its core BTL range by up to 0.24%

The lender is now offering multi-unit freehold block (MUFBs) mortgages for first-time landlords, starting from 3.49%, which join the two new products launched recently for first-time landlords to invest in HMOs.  They are now one of the few lenders who do not require some landlord experience before granting a loan on this type of property.

The green mortgage rates have been reduced by up to 0.14%, now starting at 3.24%.  This mortgage range offers lower rates for properties with qualifying energy ratings.  These green rates are only for properties that have been registered for at least 24 months with an energy performance certificate (EPC) rating of C or above.

Landbay have also introduced a large loan mortgage, a five-year fixed rate at up to 65% LTV, starting at 3.24%.  The maximum loan size is £2m and cashback options are available.

Paul Brett, Landbay’s managing director, intermediaries, said: “We constantly look to revise our range to make sure that it is highly competitive across every type of specialist buy-to-let mortgage. With our new competitive green products, plus MUFB and HMO mortgages for first-time landlords, as well as an attractive standard and new-build range, we believe that we have something for every landlord.”

Original article featured here…

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/landbay-reduces-rates-and-adds-large-loan-mortgage/

Octane Capital has another record quarter

Octane Capital, the multi-award winning specialist finance house offering bridging finance and refurbishment finance, has announced another record quarter for completions.  During Q2 of 2021, the lender has achieved over £100m of deals.

325 applications were received between April and June and 166 loans were completed.  Additionally, there was a 15% increase in the number of foreign nationals buying property in UK compared to Q1.

In June, Octane Capital completed its largest loan to date, a £17.35m five-year buy-to-let facility comprising of the refinance of 40 London properties.

Mark Posniak, managing director at Octane Capital, said: “Not only did we pass £1bn of completions in June, the second three months of the year proved to be our biggest quarter since we launched in 2017.

“Activity levels were simply off the scale; the stamp duty holiday was clearly one driver, but we’re also seeing a lot of demand from foreign nationals, mostly outside the EU, who are increasingly viewing the UK property market as a safe haven.

“With ‘Freedom Day’ behind us, we’re expecting the second half of the year to be as frantic as the first.”

Original article featured here…

During Q1 of 2021, Octane completed £92m of new lending; a 121% increase on Q4 of 2020 and the highest seen since the lender was established in 2017.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/octane-capital-has-another-record-quarter/

Masthaven research shows confidence in 92% of brokers about prospects over next year

Masthaven, the UK bridging loans and development finance bank, has published the results from its latest research, which shows 92% of brokers are feeling positive about their prospects over the next year.

Of the 186 brokers surveyed, 77% expect their sales and revenue to rise, with 42% predicting double figures for their growth in the next twelve months.  Only 3% predicted a decline in their sales to come.

Confidence was shown to be high overall by this research, with 88% feeling ‘very confident’ or ‘confident’ about the market for the coming year.  This is an increase from the last research undertaken by Masthaven, showing a certain level of normality returning to the country.

Economic uncertainty is the biggest challenge that companies are facing according to 26% of brokers, and 25% reported concern about service levels from lenders.    Just 16% of respondents felt the biggest challenge to be faced is further lockdowns, on either a local or national level, due to the pandemic.

Rob Barnard, director of intermediaries at Masthaven, said: “Broker confidence has climbed even higher since the start of the year, reflecting the current strength of the property market, as well as general optimism surrounding the UK’s vaccine rollout and the easing of lockdown restrictions.

“The industry has worked tirelessly to support homebuyers since the start of the pandemic.

“This hard work, combined with pent-up demand from early 2020 and government support in the form of the stamp duty holiday, has resulted in a booming property market – but there are still challenges on the horizon.

“The government’s various COVID support initiatives will be coming to an end soon, with the furlough scheme expected to wind down in September.

“The withdrawal of this support will undoubtedly be felt by some borrowers.

“As the market enters this next phase, brokers and lenders alike will need to work together closely to support all customers, but particularly those who have been affected heavily by the pandemic.

“Innovation and collaboration will be key in ensuring the industry continues to provide products tailored to customers’ needs.”

Original article featured here…

In December, Masthaven published the last Broker Beat, which showed confidence among brokers for 2021.  256 intermediaries were surveyed and 71%, only a 6% fall from January 2020, were optimistic about the market in 2021.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/masthaven-research-shows-confidence-in-92-of-brokers-about-prospects-over-next-year/

Interbay offering new BTL products and higher LTV limit

Interbay Commercial, the bridging finance, commercial mortgages and buy-to-let specialist finance provider, part of OneSavings Bank, has enhanced its BTL range by increasing the maximum LTV limit across all products.

This reintroduction of a maximum 80% LTV limit (previously 75%) will be supported by two new fixed rate products, a two-year and a five-year fix.

In addition, the 20 bed limit on HMO applications has been removed and the maximum loan size supporting large loans has also been removed.

Interbay recently launched a new range of holiday let products, designed for personal ownership and limited company landlords wishing to rent properties as short-term holiday lets, or for remortgages.  A new two-year fixed rate has been added to this range for applications of up to £500,000, with a £0 product fee.

Emily Machin, head of specialist finance at InterBay Commercial, said: “We’re excited about our enhanced buy to let range and are looking forward to working with our intermediary partners to help them place their customers’ cases. By increasing the maximum LTV limit on our buy to let range to 80%, we’re confident this will appeal to our broker partners, especially as we now have no upper limits on loan size or number of bedrooms/units for HMOs/MUFBs and have the capability of combining properties onto a single application which saves an enormous amount of time. With regards to our new 2 year fixed rate holiday let mortgage with £0 product fee, we’ve certainly seen an increase in demand from investors who already have an understanding of the holiday lets rental market. We know that investors are always looking for new opportunities for capital growth, to boost their rental yield and differentiate their asset class so this addition to our range will be welcomed.”

Original article featured here…

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/interbay-offering-new-btl-products-and-higher-ltv-limit/

Avamore welcomes new internal relationship manager

Avamore Capital, the London based short term and bridging finance lender, has created a new role of internal relationship manager within the origination team, and appointed Sophia Lee to the position.

Sophia was previously an associate with Cynergy Bank, where she was responsible for managing a portfolio of clients.  She also has experience from prior roles at RBS and Natwest, holds a Professional Banking Certificate and is working on her CeMAP qualification.

In her new office based role, Sophia will be developing broker partnerships and also looking to foster new relationships, promote the Avamore brand and keep clients up to date with any product changes and developments.

Sophia Lee said: “I am excited to be stepping into a brand new role at Avamore, and am committed to show the importance of the position along with the value that I can add,”

“Avamore is a young and ambitious company, and its sentiments match my own ethos.

“I always think it’s important to work in an organisation where you believe in their goals; Avamore has an extremely competitive offering backed by an excellent team with a huge amount of experience.

“Not only am I looking forward to supporting the relationship managers, but I am eager to become a champion of the organisation and deliver solutions that really work.”

Adam Butler, relationship manager at Avamore Capital, commented: “Sophia is going to bring new energy to the origination team at Avamore.

“As we grow, her position will be integral in expanding our reach and she will be fundamental in unlocking new areas and relationships across southern and central England.

“Her previous experience puts her in an excellent position to deliver outstanding service to new customers, and her drive and enthusiasm means that she will be making an impact from day one.”

Original article featured here…

Last month, Avamore hired a new relationship manager, Amir Khan, who will support broker partners in north and central London.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/avamore-welcomes-new-internal-relationship-manager/

Roma Finance adds RomaPrime and RomaPro ranges

Roma Finance, the bridging finance, short term lending and buy-to-let finance specialist, has launched two new ranges: RomaPrime and RomaPro.

RomaPrime is the new bridging range for borrowers who have a prime profile and properties of standard residential construction.  It has rates starting from 0.60% and applies to standard bridging, light refurbishment and auction finance over a wide range of property projects.

RomePro is the new development offering which is also aimed at borrowers with a prime profile, who are wishing to complete bigger development projects of up to £5 million.

For more complex cases, the existing bridging and development ranges are still available and the lender retains a flexible attitude, in order to provide intermediaries with solutions to fit the individual needs of each client.

Steve Smith, national sales manager at Roma Finance, said: “With strong and sustainable funding lines in place to help us keep pace with growing demand, now is the right time to launch these new products.

“To cope with higher business levels we are continuing to expand the Roma team and we are seeing incredible growth in our lending for property acquisition, refurbishment and development.

“The new products and lower rates will further stimulate our business in a focused and strategic way and we will continue to deliver excellent service to our intermediaries and customers.”

Original article featured here…

Last month, Roma Finance appointed Mark Foley as Senior Business Development Manager for the Midlands.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/roma-finance-adds-romaprime-and-romapro-ranges/

Landbay now offering HMO range for first-time landlords

Landbay, the buy-to-let lender, is offering two new products for first-time landlords to invest in HMOs (houses in multiple occupation).  They are now one of the few lenders who do not require some landlord experience before granting a loan on this type of property.

This new initiative comes after broker feedback revealed that first-time landlords have gained knowledge in this area and are making more enquiries.

The products are a 2-year fixed rate at 3.29% and a 5-year fix at 3.79%.  Both are available up to 70% LTV with a fee of 1.5% for HMOS with up to six bedrooms.  New-build properties will also be considered.

This news follows the launch of two new products designed for landlords with three or less properties;  a two-year fixed rate at 2.85% and a five-year fixed rate at 3.25%, both at up to 65% LTV and available on loans up to £1.5m.

Paul Brett, managing director at Landbay, said: “Landlords are becoming more sophisticated and they understand the responsibilities of managing an HMO.

“They have done their homework and know the yields on HMOs are much higher than single flats or houses resulting in greater financial rewards.”

“There is also more demand for living in HMOs, particularly from young professionals who want or need to share a house.

“Some simply can’t afford to rent their own place but many actually like communal living.

“Much of the HMO accommodation is far better quality than it used to be and can demand a higher rent.”

Original article featured here…

Landbay also now offers a green mortgage range, offering rates up to 0.1% lower for properties with qualifying energy ratings.  These green rates are only for properties that have been registered for at least 24 months with an energy performance certificate (EPC) rating of C or above.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/landbay-now-offering-hmo-range-for-first-time-landlords/

Aldermore provides £4.6m loan for Somerset development

Aldermore, the specialist finance lender, has provided a property development loan of £4.6m for the build of new residential apartments in Somerset.  The loan was granted to Refresh Property Group Limited, part of Acorn Homes Group Ltd.  In total, 40 new apartments will be constructed on a former hotel site.

The hotel, Lynton House Hotel, was badly damaged by a fire in 2008 and then another in 2015.  It will be entirely demolished to make way for the new construction, as it is not in a salvageable condition.

The development will be made up of 12 one-bedroom apartments and 28 two-bedroom apartments, located within walking distance of a range of local amenities.

Colin Ness, property development manager at Aldermore, said: “It’s great to be able to breathe new life into a site which has been derelict for well over a decade now. Mark and his team were very easy to deal with and are highly experienced at working on new build schemes such as this. We’re looking forward to seeing the site complete and contributing to the regeneration of the local area.”

Mark Thomas, managing director of Acorn Homes, said: “It was great to complete our first deal with Aldermore on this exciting project which we have been working on for seven years and taken through numerous planning processes. Aldermore offer both residential development and investment finance and as such are a natural lender for us as we are both a developer and a private sector (PRS) landlord. Colin and his team were very responsive and pragmatic throughout the transaction and we hope that this is the first deal of many together. We look forward to rejuvenating this site and adding rental stock in Weston-super-Mare to our ever-growing PRS portfolio.”

Original article featured here…

Aldermore recently provided a £8.4m development finance loan to Citu Group, a low-carbon developer, to finance the development of a 46-unit residential scheme in Kelham Central, Sheffield.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/aldermore-provides-4-6m-loan-for-somerset-development/

Bank of England data shows rise in mortgage borrowing

The latest figures from the Bank of England show that rebound in net mortgage borrowing in May, £6.6 billion up from £3.0 billion in April this year.  However, this is still well below the high of £11.4 billion in March.  The end of the stamp duty holiday, extended to the end of this month, has had a clear effect on these figures.

In May, mortgage approvals for house purchases rose from April’s figure of 86,900 to 87,500.  The peak was seen in November with 103,200 approvals.  The number of customers approved via a different lender for remortgaging rose from 33,400 in April to 34,800 in May.

Tomer Aboody, director of MT Finance, commented: “The uptick in mortgage approvals compared with April illustrates just how determined buyers are to beat the stamp duty holiday end date. Incredibly, the market upsurge doesn’t seem to be ending, with record pricing and approvals, stimulated by cheap mortgage rates at an average of around 1.9%. This is making that dream home a reality for many borrowers as it becomes more affordable than they could have imagined.

“While the market is still strong, numbers are down on the record breaking March which saw buyers rush before the previous stamp duty end.

“The market will be further fuelled by government stimulus in the near future at least, which can only mean continuing rising house prices.”

Original article featured here…

This month, MT Finance introduced a £250 credit scheme, for borrowers who attain an Energy Performance Certificate (EPC) of either A or B on their property.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/bank-of-england-data-shows-rise-in-mortgage-borrowing/

Masthaven opens new offices to allow for flexible working

Masthaven, the UK bridging loans and development finance bank, has opened a new office in London and also a new hub in Reading, to allow for a new way of working for its employees.

The new location in London, now their sole address in the city, is 15-18 Rathbone Place, London, W1T 1HU and 9 Greyfriars Road, Reading, RG1 1NU.

The Reading hub has been opened to give a key hub for staff, enabling a more flexible approach for employees to choose their work space.  This combination of remote and office working is the new hybrid working model. This will also reduce the lender’s carbon footprint by reducing unnecessary travel and allows for its growing number of staff.

Leigh Bartlett, CEO at Masthaven, said: “The opening of our two new offices demonstrates our commitment to supporting our growing team and allowing them to work in the way that’s best and safest for them”

“Despite the upheaval of the pandemic and the mass move to homeworking, our team has handled the challenges of the last year brilliantly, working hard to support both customers and brokers.

“It’s clear though that, even as the pandemic restrictions begin to ease, life for many of us is going to be very different from the pre-2020 status quo.

“We will still maintain a base in London to cater for colleagues in the capital and ensure we’re in the best location for London-based customers and brokers.

“Reading is also an important hub for the bank and our new office there will be an easier commute for many of our staff.”

Original article featured here…

Masthaven recently made a number of changes to its bridging loan range, including the launch of their lowest ever bridging rate.

source https://commercial-mortgages-broker.co.uk/buy-to-let-news/masthaven-opens-new-offices-to-allow-for-flexible-working/