The property market has been interesting to say the least over the last 2 years. As with many industries, the economic uncertainty has slowed down the rate in which people are wanting to buy and sell. In this blog we will cover why: Buy to Let has slowed down in 2023, prices on rental properties and the experts believe it will make a comeback in 2024.
Whats the difference between Buy to let and residential lending?
It’s crucial to understand the key distinctions between a residential mortgage and a Buy to Let mortgage. A residential mortgage is designed for individuals purchasing a home to live in. Therefore, emphasising factors such as personal income, credit history, and the property’s value.
On the other hand, a Buy to Let mortgage caters to investors looking to buy property with the intention of renting it out. Lenders assessing these applications often consider potential rental income, alongside the investor’s financial stability.
Why has Buy to Let been difficult in 2023?
Navigating the property landscape in the UK in 2023 has presented unique challenges for investors. Stringent regulatory changes and evolving market conditions have contributed to the complexity of securing Buy to Let mortgages. The increased scrutiny on affordability assessments and stress testing by lenders, combined with changes in tax regulations, has made it more challenging for investors to achieve the desired returns on their property investments. The additional stamp duty that Buy to Let buyers require mean that initial costs are more than they used to be. As well as high interest rates making monthly rental payments so high for tenants and less profitable for landlords.
What’S DIFFERENT FOR BUYERS LOOKING TO BE LANDLORDS IN 2024?
In 2024, property market in the UK is experiencing a resurgence, presenting new opportunities for property investors. A more stable economic climate and a clearer regulatory environment have contributed to the renewed interest in Buy to Let investments. Lenders are adapting their approaches. Constantly lowering rates and offering competitive mortgage products. As well as more flexible terms for those looking to purchase properties with the intent of renting them out. The Estate agents who we partner with are also expressing that their rental properties are in high demand.
At Clements Financial in Peterborough, we understand the evolving dynamics of the property market. Our expert mortgage advisors are well-equipped to guide prospective investors through the changing landscape, providing strategic advice tailored to the unique needs of those seeking to capitalise on the resurgence of the buy-to-let market in 2024. Explore the potential with Clements Financial for personalised and forward-thinking buy-to-let mortgage solutions in the thriving UK property market.
