The Specialist Lending Expo highlights both prospects and challenges in the current housing market.
- Success in the housing sector hinges on stability and support from the new Labour Government.
- Industry leaders express concerns over ambitious housing targets but acknowledge positive steps in planning reforms.
- The market for specialist lending is evolving, driven by borrowers’ needs amid stricter affordability checks.
- Experts predict a robust rental market due to policy changes affecting first-time buyers.
At the Specialist Lending Expo, experts discussed the critical need for market consistency, particularly in light of recent policy changes. The focus was on utilising opportunities within the housing market, contingent on the Labour Government’s ability to provide stability and support. The session titled ‘The Mortgage Market and its Opportunities’, led by Rob Jupp of The Brightstar Group, resonated with this sentiment.
David Whittaker of Keystone Property Finance questioned the feasibility of the Labour Government’s commitment to constructing 1.5 million new homes. Despite scepticism about meeting these targets, he remains hopeful due to the proactive stance of Housing Minister Angela Rayner towards reforming the UK’s planning process. Such reforms could be instrumental in alleviating the housing crisis.
Adrian Moloney from OSB Group suggested that recent economic turnover gives Labour a fighting chance to meet these objectives. He emphasised the importance of consistency, advising the government to avoid the leadership changes that characterised previous administrations, which had disrupted progress in the past.
Panellists observed significant shifts in the mortgage market, with a notable rise in demand for specialist lending solutions. This trend arises from borrowers grappling with tighter affordability checks and a lack of governmental aid for first-time buyers. Notably, the Autumn Budget’s omission to extend the SDLT discount for first-timers is likely to strengthen the rental market further, according to Barry Searle of Castle Trust Bank.
In contrast, professional landlords find the current climate ripe for innovation, particularly in refurbishment loans. Searle pointed out an increasing demand for quality rental properties, which he believes presents substantial opportunities for landlords who remain active in the market. This optimism persists despite the slowdown in mortgage activities witnessed in recent years.
Steve Cox from Fleet Mortgages maintains that despite challenges, the buy-to-let sector and private rental markets are poised for longevity, driven by ever-present housing needs. Landlords are diversifying investments to obtain better returns, with a pronounced interest in HMOs, especially in university towns, a strategy yielding average returns of about 6.03%.
There is an ongoing trend where landlords explore regions beyond their usual territories to tap into higher yields. Whittaker reassured stakeholders that the fundamentals of the buy-to-let model remain sound and continue to provide appealing investment returns.
The future of mortgage lending and housing market stability depends largely on consistent policy and economic conditions fostered by the incoming Labour Government.
