Faulkner, whose work in the property industry is centred around creating better outcomes for consumers, discussed the barriers that face consumers taking their first steps into buy to let, and noted that often they are left speaking to letting agents, mortgage advisers, and legal companies who aren’t trained to help buy to let investors get the most out of their investments.
She added there was an issue of unrealistic expectations of buy to let, adding that consumers ‘need to be educated’ about their return on investment – for example, determining from the outset whether a consumer is aiming for capital growth or an income could make a difference to the way they should proceed.
Faulkner predicted that most investors would now be aiming for capital growth as taxation changes make using BTL property as an income source less feasible for first time investors. She added that in future, capital gains tax ‘could be adjusted to match income tax thresholds, which is another threat on the horizon’.
With these threats in mind, she said – to those on the advice side of the industry – “We need to offer a better service. I want a proper buy to let service, and that starts with you.”
She added:
“We need to be asking - are we actually selling this properly? Are we offering the right service? It’s not just about writing mortgages, it’s about protecting that customer for life. If they don’t buy property that’s right for them, they’re going to lose out, and you’re going to lose them as a customer.”
She was insistent that the industry needs to work together more in terms of informing and education consumers on buy to let and how it actually works, citing tax implications and will-writing as examples of issues that consumers need to be aware of before making an investment.
She said:
“We need to be joined up. I don’t understand why we don’t have an industry that doesn’t rally behind the consumer. All first time buyers want is a first time buyer service, and they’re being told by some big lenders if you go to a broker it’ll cost you money for advice. But, if you ask me, lots of first time buyers should be going to brokers, because they need that help and that care and attention. They need to understand the options and implications of going direct to a lender or going to a broker.”
