34% of landlords purchasing another BTL property

Thirty-four per cent of landlords have recently purchased another buy-to-let (BTL) property or intend to buy one within the next nine months, new research has revealed.

A survey by The Deposit Protection Service (The DPS) and Zephyr Homeloans suggested that the “opportunity to buy at a discount” is the most commonly cited reason among those who have recently bought or soon intend to buy additional rental property.

The findings, based on a poll of more than 300 landlords, showed that other key factors included long‑term investment (35%), stamp duty savings (34%) and diversification by either location (26%) or property type (23%).

Less than half of landlords (43%) of landlords surveyed said that they had temporarily lowered rents during the pandemic to help tenants, while 22% said they had refinanced their mortgages since the arrival of coronavirus.

Zephyr managing director, Paul Fryers, commented: “Understanding the purchasing motivations behind professional landlords is an essential factor for Zephyr and our mortgage broker clients.

“It’s equally important to recognise and appreciate some of the challenges landlords have been facing during the past year and how they will affect their current and future applications.

“During the pandemic we saw a significant rise in the use of limited companies to buy and manage property portfolios, and it seems a significant proportion of landlords have made the most of the opportunities provided by the buoyant market conditions we have experienced over the past six months.”

The DPS managing director, Matt Trevett, added: “Although the BTL market has remained more buoyant than some predicted, the last year has not been without its challenges for many tenants and landlords.

“The survey suggests a large proportion of landlords have been acting to support their tenants, with a significant proportion saying they had temporarily lowered rents during the pandemic.

“A recent survey from The DPS also showed that the pandemic has triggered movement from cities to towns and the countryside, so landlords seeking to rebalance their portfolios may look to make purchases that reflect that trend.”

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