Confidence remains key in BTL sector

On such occasions it’s easy to cheer for the underdog, at least when they are not playing your team. Many come into the game fully prepared but aware of the uphill battle facing them. Providing they don’t concede a goal early in the game, you can often see their belief grow as the potential for a positive result draws closer.

Confidence is a major issue across any sporting field or business sector, although this can prove difficult to manage or gauge when major influencing factors are often beyond your control. The latest quarterly BM Solutions/BVA BDRC Landlords Panel outlined positives and negatives which served to sum up confidence levels amongst landlords during challenging market, regulatory, economic and political conditions.

It found that landlords are feeling the impact of government reform, particularly those with larger portfolios. More than half (55 per cent) of landlords said their level of profitability has been affected since changes to the buy-to-let market were announced in 2015. Larger portfolio landlords experienced this the most, with 75 per cent of those managing between 11 to 19 properties saying their level of profitability has decreased. Almost one in four (23 per cent) of landlords are also planning to sell at least one property this year, with landlords owning a portfolio of 11–19 properties more than twice as likely to sell. This compares to just one in seven (15 per cent) of landlords who said they are looking to increase the size of their portfolio.

However, there was also a bright side to this data. One in four landlords reported an increase in perceived tenant demand over the last three months, although this picture varied across the country. It also highlighted that the proportion of landlords making a profit from their lettings activity remained at 88 per cent, equalling the record high seen in the previous quarter.

There is also plenty of confidence to be taken from some positive criteria changes and competitive products emerging over the first few weeks of 2019. Like all sectors within the mortgage market, activity is suffering slightly from the Brexit effect but BTL demand shows no sign of slowing anytime soon.

And come FA Cup final day in mid-May, hopefully there will be less uncertainly in the air and BTL confidence levels will also be lifted in equal measure.