The panel discussion, which featured representatives from four lenders in the sector, was chaired by The Buy to Let Club MD Ying Tan.
The audience, consisting of brokers, first asked the lenders about the increase in BTL lending for new build properties, which all of the panellists agreed was on the rise.
Precise’s Managing Director Alan Cleary begun, saying:
“Precise is predicting we’ll lend a quarter of a billion on new build in 2016. A big issue from the lender and broker perspective is fraud, and that’s what put most lenders off in 2008 and beyond. But that’s also largely down to rings of collusion between property clubs and conveyancers – although of course there are also dodgy brokers and customers.
“So obviously we have to be on the lookout for that, and we’ve done a lot of work as lenders to break down those rings, but from a broker point of view it’s difficult not to get caught up accidentally.
“For new build on the whole, we’re much happier with it now, as I think most lenders are.”
Robert Barnard, Head of Intermediary Distribution at Aldermore Bank, added that Aldermore ‘had been committed to the new build market for two-three years now’, having taken advantage of Government schemes such as Help to Buy.
Panellist Phil Rickards, head of intermediary lender BM Solutions, added to Cleary’s warning about property scams, noting that brokers should ‘ask all the questions you need to – any inclination that a deal was not what it first appeared to be is when you should be making those extra couple of enquiries’. He added, however, that BM Solutions was ‘very much open for new build business’.
When quizzed on the topic of further regulation in the buy to let market, Fleet Mortgages CEO Bob Young said he thought the topic was a ‘political football’ as it was tied into wider issues in the housing market. All of the panellists agreed that the FPC were likely to implement loan-to-income caps next year, and when discussing rent controls Young said they could ‘destroy the market’ and that ‘joined-up housing strategy’ was the key to smoother sailing for the property market.
Rob Barnard added that, in light of minor changes to BTL as a result of the upcoming Mortgage Credit Directive, it is ‘frustrating’ for brokers.
He said: ‘No sooner than MMR had landed, you had another piece of regulation to deal with’, but added that the emphasis was on lenders, not brokers, to be fit for purpose.
Alan Cleary added that from a broker perspective it would have ‘very little impact’.Overall, however, the lenders were optimistic about the next twelve months in the buy to let market, with the lenders choosing ‘positive’ and ‘sustainable’ as their buzzwords for 2016. They continued to stress the importance of brokers in the market, and said despite increasing use of technology, the face to face interaction with the consumer was ‘invaluable’.
