With many tenants prevented from moving in the past few months due to the lockdown, agents expect the next couple of months to be a busy period as renters start to look for available properties and make their move, now that the market has reopened.
At the same time, many of those wishing to purchase an abode are finding it more difficult to have mortgages approved and will need to rent for longer. With more buy to let mortgage products available and tenant demand remaining high, it can be ideal conditions for buy to let landlords considering increasing their portfolio.
Bank of England’s data recently showed that there were only 9,300 mortgage approvals in May, a huge difference to economists’ forecasts of 25,000 for that month.
Specialist buy to let mortgage lender, Landbay, have recorded a significant increase in the demand for buy to let properties. CEO, John Goodall, stated: “[Buy-to-let] Mortgage borrowing increased in May and we can only hope that we have now turned a corner and will incrementally see demand increase month on month.
“It will be more challenging for many people to get mortgages however, particularly if they have been furloughed or lost their jobs. This is reflected in the dire situation where mortgage approvals were only a tenth of what they were in February.
“What this does mean is that the demand for private rental property is likely to increase as the year progresses.
“Those who would ordinarily have bought a property may well be struggling to do so and we have already seen demand from landlords increase sharply in the last month.”
Managing Director of Edinburgh based 1LET, Ewan McLean-Foreman shared their experience of the market: “As a business we have definitely had a sharp spike in our “v graph” (vacancy graph). Not knowing quite how high vacancy figures would go was pretty alarming at times, but the graph is now falling faster than it went up and our pipeline of new “move-ins” has got us all high-fiving again.
“New enquiries were actually surprisingly steady throughout, but the team are now all flat out dealing with the current demand. New business enquiries are also up year on year.
“Challenges remain for all of us and the marathon is definitely not over yet, but we are feeling really strong and positive as we move into July – long may it continue.”