Some 30 per cent of landlords who plan to remortgage by mid-2022 intent to release equity from their properties according to Foundation Home Loans.
And the research, conducted by BVA BDRC, showed that portfolio landlords - those with four or more buy to lets - are more likely to want to remortgage in the next 12 months than smaller landlords.
Portfolio landlords were also significantly more upbeat about the prospects for their buy to let income - 46 per cent said they felt either ‘good’ or ‘very good’, compared with just 35 per cent of single property landlords.
For the largest-scale landlords - with 20 or more properties - the proportion regarding business as good or very good shot up to 50 per cent.
Portfolio landlords with more than four mortgaged properties had average portfolio values at over £2m for the first time since late last year 2020.
George Gee, commercial director at Foundation Home Loans, says: “We’ve seen the buy to let market moving steadily towards a greater level of professionalism for some years now, and this has meant a growing number of landlords are now defined as ‘portfolio’ operators and have long-term plans which involve making the most out of their properties.
“The research shows a number of key portfolio landlord intentions, particularly around extracting equity from their properties.
“Over the past year, in many areas of the country, we’ve seen double-digit house price growth, and even without access to the stamp duty holiday, the intention to remortgage to take out that increased value to purchase more has grown.
“It means advisers are likely to see a growing spike in buy-to-let remortgage advice demand, and the positive news is there are very competitive product options for all types of portfolio landlords at present.
“Portfolio landlords are likely to grow in number in the months and years ahead, and as specialist lenders in this space, we will continue to develop the product options and flexible criteria to help them get the most out of their existing properties to expand their letting footprint.”
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Many smaller LLs will be leaving the sector over the next few years - increased legislation / tax & EPC C will see to that. But the demand for rentals will not be diminished, so for those who plan to stay for the long haul I believe there will be good rewards. For those of us who have been in a while & who are approaching retirement now looks like a good time to get out. The people who are in trouble, as ever, are the tenants, as deminishing stock & high costs are going to price many people out of the market with nowhere else to go :(
Is it sensible to be increasing debt ?
Most remortgaging by landlords is to get the lower interest rates ( many well under 1%) and not to increase debt.
Remortgaging is also now a valid alternative to short term borrowing, provided it is repaid over a short term, although buying from savings is still the best approach.
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