Intermediaries urged to focus on professionals

Speaking on a recent Legal and General Mortgage Club webcast, Managing Director of Paragon Mortgages John Heron said that intermediaries who are not currently operating in the buy-to-let market should look to professional landlords to grow their business.

Research commissioned by Paragon Mortgages and carried out by BDRC Continental revealed that seven out of 10 professional landlords with 20 plus properties in their portfolio are making a full time living out of their activities.

Of those landlords who own between five and 19 rental properties, 44% are making a full time living from their portfolio.

The research also showed that professional landlords generated the highest rental yields in quarter three, with those who own 20 plus properties achieving an average yield of 7.7%. Landlords with a portfolio of 5 to 19 properties generated a yield of 6.5%.

 Recent Government figures also stated that 39% of stock is owned by 5% of landlords, emphasising the importance of the professional landlord market.

Mr Heron said:

“Professional landlords are key for intermediaries who are looking to expand their business in the buy-to-let market, as they are natural repeat customers and habitual purchasers of buy-to-let property.

“My advice to intermediaries who are considering operating in this market would be to make sure they do their research. Professional landlords’ requirements are often more complex as they are likely to purchase more diverse property types, so knowledge of how they operate is essential.

“With continuing growth in the PRS expected for the next 12 months, now really is the time for intermediaries to review their current strategy and see how they can reach these potential customers.”

To hear more of John’s views, download the Legal and General Mortgage Club webcast here