According to the lender, rising interest rates and continued house price inflation combined with steady rental returns mean that, while buy-to-let remains a solid long-term investment, fewer and fewer first-time investors are able to enter the market based on traditional lending criteria, which consider rental income in order to judge the affordability of the loan.
The Kensington self-cert buy-to-let product is designed to help the thousands of homeowners, who do not need to rely on rental income to cover their buy-to-let mortgage repayments because they have the excess personal income to service another mortgage.
Ian Giles, director of marketing at Kensington, said: “The buy-to-let market is changing. There continue to be real opportunities presented by buy-to-let, but with house prices continuing to increase, interest rates rising and rental yields remaining fairly static, it is becoming much harder for new investors to enter the market. Kensington have recognised this and built a product to help more borrowers benefit from the sector. If you have enough extra income at the end of each month to service the mortgage on an investment property, why should you be constrained by rental yields? This product will empower a new breed of buy-to-let investor, but it is just the start, and our customers can look forward to more innovations from Kensington in the near future.”
