Trust in BTL is growing as landlords take out larger loans

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Despite the difficult tax measures in recent years, UK landlord confidence appears to be growing. The latest data shows they are putting their money where their mouth is.

According to newly released data from Keystone Property Finance, mortgage products that are designed to offer exclusive interest rates on larger loan amounts are now the most popular product among landlords of purchase. Figures show that 58% of Keystone customers have applied for their larger credit spread since December 2020. The BTL Lender’s larger loan range offers loan sizes from £ 250,000 to £ 1 million and offers interest rates of 3.09%.

The surge in popularity for larger loans could be due to landlords taking advantage of the stamp duty incentive for property taxes and looking to afford more expensive real estate because of the tax savings. In fact, data shows that due to the SDTL incentive, landlords accounted for 15% of all sales agreed in November 2020, the highest level in four years.

Today’s numbers also signal a growing confidence in the market as landlords continue to borrow larger mortgages in anticipation of continued spike in future house prices and positive rental returns after the pandemic.

The data also shows differences in the types of landlords applying for larger loan products from the specialist lender. Almost two-thirds (62%) of requests are from limited liability companies, compared with 38% of requests from individual landlords.

Elise Coole, Managing Director of Keystone Property Finance, comments: “Our data shows that landlords remain confident about the BTL market. The majority of customers want to get a larger loan to buy their property. Undoubtedly, the SDLT incentive played an important role in this, providing landlords with an excellent opportunity to bolster their portfolios and invest in higher quality properties.

“The private rental market is critical to millions of people. At Keystone Property Finance, we are committed to supporting our brokers and their landlords with a wide range of innovative solutions.”

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