1^st Jul 2018

Build to Rent will become responsible for the eventual 'extinction' of the buy to let landlords claims Scott Marshall the managing director of a specialist finance house.

According to Marshall the firm is seeing a considerable growth in BTL landlords evolving into limited companies, and unfortunately those who haven't done so are finding it hard to cope with the new tax and regulation changes that are blighting the private rented sector.

He believes that the new HMO regulations starting 1st October will see many landlords having to become more creative in their approach to the sector, and said: “We expect that there will be some casualties in terms of compliance with the new HMO rules and there are likely to be a period of adjustment in the shared facilities housing sector, for example in London some landlords are moving into Airbnb letting instead”.

The new EPC ratings regulations introduced in April will have caused many landlords to stretch their finances even further, and Marshall said: “Clearly a barrage of regulation and legislation is moulding a new breed of landlords. The days of the hobbyist landlord are numbered as the upkeep and management of rental properties becomes more onerous.

“Only the larger players will be able to cope, as they can benefit from their scale of operation. With the HMO rules coming into force in October, maybe more affordable housing is needed more than ever as an alternative.

“As a lender we’re still experiencing a high level of finance demand for rental property, and in the wider market there are many product updates being introduced as lenders seek to adjust criteria to keep pace with a changing market. But it seems clear that the future will be driven by professional landlords rather than the armchair investors of the past.”

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