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One of the country’s biggest buy-to-let lenders has overhauled its mortgage terms to attract landlords with multiple properties, as the number of smaller investors continues to dwindle.
Landlords have been hit by an increasingly strict tax regime, as the Government has withdrawn multiple tax breaks in recent years.
These changes, along with the proposed removal of no-fault evictions, have driven many owners of single rental properties out of the sector.
Industry experts say this market shift is why BM Solutions, part of Lloyds Banking Group and one of the country’s two largest buy-to-let providers, has opened up its lending rules to allow portfolio landlords to borrow against a greater number of properties than previously.
Landlords can now have five buy-to-let mortgages across Lloyds’ brands, with a combined loan size of up to £3m, whereas until this month investors were limited to just three loans worth a total of £2m.
Aaron Strutt of Trinity Financial, a mortgage broker, said this was the first time that Lloyds had shifted its buy-to-let policy in nine years, and showed how banks were desperate to drum up business from landlords who remained in the sector.
“Lenders have been targeting larger landlords and offering great rates,” he said. “They are trying to tempt them into buying more properties or to remortgage.”
Mr Strutt said there were fewer smaller landlords operating in the sector than previously, hence how lenders had shifted their attention to those with a portfolio of properties.
“We are still getting enquiries from smaller landlords but not as many as we have been used to over the years,” he said.
"Professional landlords have been buying new properties and making sure they are getting the best possible deals when their fixed or tracker rates expire.”
Mr Strutt said BM’s two-year fixed-rate deal at 1.72pc and five-year fix at 1.95pc were particularly competitive. Both deals require the landlord to have a 40pc deposit and fees apply to both mortgages, £995 and £1,995 respectively.
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