A survey by the RLA has revealed that almost half of landlords have found it very difficult or impossible to obtain a buy-to-let mortgage.
When asked how easy they had found it to access a buy-to-let mortgage, 21.3 per cent of the RLA members questioned said they were “unable to obtain” a buy-to-let mortgage, and another 24.1 per cent saying they found it “very difficult”.
The findings come as the Government seeks to boost support for the private rented sector following the publication of the Montague Review; and they prove that the biggest challenge facing the new housing minister, Mark Prisk, will be to unlock the financial support needed from banks, to support the army of small scale landlords that make up the vast majority of the sector.
And, with mounting concerns about higher rents in the sector caused by the shortage of supply, the reluctance of the banks to lend is severely hampering the ability for the sector to grow to meet the housing needs of particularly young people and families.
RLA Chairman, Alan Ward, said: “We welcome the Government’s renewed commitment and interest in the opportunities that the Private Rented Sector can play in meeting the country’s housing needs. However, this will not happen without financing from the banks.
“It is time that the blame game for the difficulties in accessing finance between Government and the banks came to the end for the sake of those desperate for a roof over their heads.
“The RLA is confident that landlords are ready and willing to invest. A hundred thousand homes per year is a strong marketing opportunity and it’s time that the banks recognised that and started lending again.”
- 141 members of the RLA responded to an online questionnaire in which they were asked “Have you found it easy to obtain a buy-to-let mortgage?”. Responses were:
- Yes, it was very easy – 14.9%
- It was fairly straightforward – 17%
- I had to shop around to get a decent deal – 22%
- Very difficult – 24.1%
- I have been unable to obtain a buy-to-let mortgage – 21.3%
- Don’t know/No answer – 0.7%
- The RLA offers a wide range of mortgage products. To find out more please visit: www.rlamortgages.co.uk.