Is this the year that buy-to-let gets back onto the front foot?

Not according to IMLA, which has said that it expects gross buy-to-let lending to fall slightly to £40 billion in 2020 and £39 billion in 2021 as the market continues to adjust to mortgage interest tax deduction being fully removed in April of this year. IMLA says, however, that tenant demand is strong, which has prevented a net exodus of landlords, and this demand looks set to only head in one direction.

The Private Rented Sector now accounts for around 20% of all households in the UK, with an increase of 2.5 million rental homes since 2000, according to a report by Seven Capital. The report says a record 1.13 million-over 50s are now renting from landlords, which is up from just 651,000 a decade ago and that, by 2021, one in four people will be looking to rent. Over the next four years, the number of households in privately rented accommodation is expected to grow to 5.79 million.

The latest RICS Residential Market Survey says that going forward, rents are expected to increase as a consequence of the imbalance between rising demand and falling supply. Indeed, projections point to around 2% rental growth over the coming year, while this is anticipated to accelerate to average closer to 3% per annum over the next five years.

And the outlook for the housing market in general also looks more positive. RICS says that sales expectations have risen sharply and a number of key activity metrics have moved into positive territory for the first time in several months.

Set against this backdrop, while the macro picture for buy-to-let appears to be flat, a number of the fundamentals point to big opportunities for individual landlords to get back onto the front foot and grow their portfolios. Indeed, the major hurdle to market growth seems to be tax changes, but for the many landlords who are now choosing to hold their investment as a limited company, the impact of these changes can be mitigated. So, maybe 2020 could be the year that your buy-to-let clients get back onto the front foot.