This is according to Mortgages for Business. Nick Blunt, head of business partner development at Mortgages for Business, commented: “In recent years, investors have benefited across the country from huge capital growth over a relatively short period of time, but this is now an unrealistic way of looking at buy-to-let from an investment perspective. It is going to come back to looking at the yield your properties will provide, and over what period of time that yield can be sustained or increased.”
Investors need to develop a strategy and using the services of a broker is one of the ways to achieve this. There may be fewer mortgage products on the market, but there are some good deals available and it is important to be able to access those deals.
Nick Blunt continues: “By working with your broker to build a strategy of where you want your portfolio to be in the next two, five, 10 years, they can help you to achieve those goals more effectively”.
Investors should identify
• Unprofitable properties within their portfolios and consider selling and replacing these.
• Look at the level of rent against the local market and if this can be increased.
• Look at the type of tenant they have – some tenant types are more expensive to finance.
• Look at if they can take advantage of the dip in house prices to add to their portfolio.
Over the past six months predictions of house price decreases have deterred some investors from investing further into buy-to-let, however the recent house price decreases in the market matched with rising rents have in fact allowed broader investment opportunities to emerge.
Nick Blunt commented: “As house prices decrease, investors with cash in the bank should be looking at the longer term value of the investment in bricks and mortar. Landlords currently have a fantastic opportunity to ‘grab a bargain’ and we advise them to keep their eyes open for the best investment opportunities.”
