According to research by Alliance & Leicester, intermediary advice was vital for landlords who were looking to maximise their buy-to-let (BTL) returns. According to brokers, landlords were turning to them for qualified advice and exclusive BTL deals.
Mortgage intermediaries predicted that over a third of investor landlords could make an operating profit in 2008, while 43 per cent of professional landlords could achieve a positive net yield.
Possible stumbling blocks for brokers included the market’s fluctuating Base Rate, according to a third of respondents, while 27 per cent claimed that cooling house prices was affecting them.
Meanwhile one in 10 mortgage intermediaries expressed concern that rising house prices were leading to a reduction on the rental return on properties.
Mark Blackwell, director of intermediary sales at Alliance & Leicester, commented: “Investing in BTL properties should be seen as a long term investment. Despite this, intermediaries expect nearly 80 per cent of landlords to make a positive return on their investment this year.”
He added: “Those with multiple properties and a higher proportion of fixed rate lending are most likely to be able to withstand any house price cooling and fluctuating Base Rates.
"Landlords with fewer properties in their portfolio will need to be astute in the coming months to avoid potential pitfalls, with professional advice playing a particularly important role to them at this time.”
David Salusbury, chairman of the National Landlords Association, said he expected to see increased demand for private rented properties in the future.
He explained: “Healthy rental yields are critical to encourage more and more investment in residential property, particularly when the market is slightly cooling.
"The chances are, in the coming months, there will be increasing demand placed on the private rented sector and well-managed portfolios can only serve to benefit both tenants and landlords alike.”
