Fantasy Landlords: Is it the right moment to play the wild card?

Is it the right moment to play the wild card? Maybe it’s time to call for additional support from the bench? Or to bring in the big guns? Can I make space for Salah, or will Hazard do the business? Fantasy Football is full of tough decisions, especially as the season comes to a crescendo and the stakes become even higher. What else could I be talking about?

It’s all about finding the right balance. Where should I invest, how many changes should I make to my formation, what are my competitors doing, where is the real value?

Is Fantasy Football more comparable to Brexit or landlords? That’s a tough one. But for once – as difficult as it may be in the current economic and political climate – let’s not focus too heavily on Brexit, let’s focus on landlords.

As a manager of a property ‘team’ landlords have had to overcome their fair share of challenges over the past 12-18 months and needed to reassess their strategy on more than one occasion.

Statistics are fundamental within the world of Fantasy Football, and it’s no different within the buy-to-let sector. Whether on an internal or external basis, filtering through all kinds of data is key to ensuring the right decisions are being made now, and in the future. Inevitably, budgets, spending and profitability all play a huge role within these.

The recent BVA BDRC Landlords Panel Report for Q4 2018 outlined that the proportion of landlords making a profit from their lettings activity remains at a record high of 88%. It suggested profitability typically increases as a portfolio grows, adding that over half of landlords make a full-time living from their letting activity when they have six-plus properties, with this rising to three-quarters of those with 20-plus properties.

Overall, the report indicated landlord’s profitability remained strong but over half of landlords (55%) felt their level of profitability had been impacted by the series of taxation changes announced in 2015 onwards.

All landlords have been affected to some extent, with larger portfolio landlords most impacted. In the segment managing between 11 and 19 properties, 75% felt their level of profitability had suffered. These figures should come as no surprise and help demonstrate how important it has been for landlords to become more fluid in their tactical approach, and in the ‘transfer market’.

The report went on to suggest almost one in four (23%) landlords plan to sell at least one property in 2019. Landlords with a portfolio of 11-19 properties are said to be more than twice as likely to sell compared to the ‘average’ landlord, with one in three of these planning to sell at least one property in 2019.

The proportion looking to increase the size of their portfolio was very stable at one in seven (15%). And when combined with further data from the Ministry of Housing, Communities & Local Government, which suggested only half of landlords plan to keep the same number of rental properties over the next two years, it appears that we still have a pretty strong purchase ‘transfer window’.

The buy-to-let market is still performing incredibly well and that presents profitable opportunities for both landlords and intermediaries across the UK. Value is out there, and there are a wealth of active buy-to-let players (lenders such as Foundation) to choose from. Plus of course, we are seeing far greater product choice in specialist areas which will suit this, and the next, generation of buy-to-let landlords. In some ways this could be the ‘golden generation’.

As always though it’s about making the right decision at the right time and there is plenty of support and resource out there, particularly from the specialist lending community. Advisers can ensure landlords make the right decisions and that ongoing growth and success in this sector is very far from a fantasy.