Simon Bayley, commercial director at Foundation Home Loans, says buy-to-let is business as usual
We are being bombarded with comment and opinion about how the buy-to-let market will fair in 2016. The overarching belief is that there will be a rush to get new property purchases over the line ahead of the tax changes in April. However, the idea that there will be a sudden ‘new’ business stampede could really just be an illusion. In the real world, landlords will have already found the property they want, have done the due diligence in terms of likely rental return and are already pursuing their preferred funding option.
Realistically, there are about 12 weeks to push through new deals and, therefore, here at Foundation Home Loans, we are not expecting a rush of business due to landlords breaking the doors down with fresh enquiries to beat the deadline.
What we are expecting is that completion figures will definitely be strong in the first quarter and those lenders with a strong limited company buy-to-let proposition will be particularly busy as landlords look to move existing portfolios and or new property into an SPV.
The upcoming MCD will have the effect of making lenders look more carefully at what constitutes a buy-to-let loan for ‘professional’ landlords as opposed to those who potentially fall into the new regulated consumer buy-to-let. We shall continue to champion first-time landlords but consideration needs to be given by the industry to ensure that regulation does not end up sidelining the ‘amateur’ landlord.
The CML has made the plea for more stability and less intervention in the lending market and I believe that should also apply to the state using ever more elaborate and bespoke tax schemes to tinker with the market. The one thing we can all agree on is that 2016 needs to be a year for regulator and government to step back and let the changes that are due, be assessed over a number of quarters, to understand fully if these have delivered the government’s goals without generating further risk to a segment that has seen significant changes over a very short timeframe.