Desktop Valuations Launched

The Mortgage Lender has launched desktop valuations for buy-to-let (BTL) purchase and re-mortgage products up to 75% loan-to-value ratio (LTV).

From Monday 27th April, desktop valuations will be available for existing BTL pipeline cases where possible, and for the majority of new individual, expat and limited company applications.

For properties that are not suitable, including houses of multiple occupation and multi-unit blocks, applications can still be submitted by brokers and cases will be progressed once a physical valuation is possible.

The move follows the launch of a revised buy-to-let range, with 2-year fixed rates starting from 3.13% for individual and limited company applications at 70% LTV, and 5-year fixed rates starting from 3.49%.

But-to-let re-mortgages forge ahead

Re-mortgage instructions recovered to pre-lockdown levels last week, with an increase of nearly 40% compared to the previous seven days, according to recent data.

In the third week of May data recorded the highest volumes of re-mortgage instructions since the week commencing March 9 before lockdown measures were introduced.

Buy-to-let re-mortgage completions are 3.7% lower than the average for the same period last year.

Re-mortgage instructions have spiked since the reopening of the housing market last Wednesday (13 May) as borrowers take the opportunity to capitalise on the increased number of products available on the market and make financially savvy decisions to ensure they have the best products for them.

Restored market confidence and the consequential increase in instructions will continue as additional higher LTV products are brought back to the market and borrowers are able to alter loan amounts or change lender. The industry must continue to work together as demand will likely continue to increase in the coming weeks.

Females are dominating the buy-to-let market

New figures reveal women now account for 47% of the 2.5 million buy-to-let investors in the UK – which is an increase from 46% in the previous year.

When it comes to the actual number of residential property landlords who are women, the most recent data available – from the 2017/2018 tax year – revealed this figure had increased 5% to 1.2 million.

This thinning gender gap amongst buy-to-let investors is likely to be because women prefer lower risk investment options.

According to a study published in the European Journal of Finance by Dr Ylva Baeckström of Kings College women, generally, had a ‘less aggressive appetite’ for risk than men.

Rates are still falling but for how long?

Research shows that the average two-year fixed BTL mortgage rate has fallen by 0.35% in just one year, and even though the pace of the fall has slowed in recent months – the vast majority of that decrease took place last year.

The figures also show that the market has now recovered from the significant drop in products that was seen at the start of this year, suggesting that landlords can benefit not only from low rates, but also a higher number of mortgages to choose from. The choices have also increased in the limited company sector as well.

The BTL market has seen some turbulent times, with significant tax changes, tougher affordability rules, and still more changes to come. Yet, rates have continued on a downward spiral.

New regulation brought tighter affordability rules into play, effectively reducing the amount that landlords can borrow. This had a knock-on effect on availability, and indeed the pace of rate cuts, yet it seems that the market is recovering.