Landlords want more certainty from lenders in a volatile environment, according to Landbay’s latest buy-to-let survey.
The research focused on how landlords have dealt with a recent period of instability and uncertainty in the mortgage market.
The research shows that more than 80% of landlords currently view the buy-to-let market as unstable or unpredictable, with 55.6% describing conditions as ‘somewhat unpredictable’ and a further 26.3% saying the market is now ‘very volatile’.
Landbay said the results reflected the disruption seen in the market in March and April, particularly in the areas of rates and product availability, but added that landlords remain engaged with the market and continue to actively seek financing and advice.
The research shows that recent market conditions have already influenced landlord behavior. More than a third (35.3%) said they had reduced activity due to global events and interest rate movements, while another 21.8% said they had postponed plans altogether.
At the same time, almost half (49.6%) said they were confident in access buy-to-let The financial sector has deteriorated in recent months, although 45.1% say confidence has remained the same, indicating that landlords still believe financing remains accessible despite the current climate.
Landbay said the findings highlight how advisors can play a key role in helping landlords understand the options still available to them in a changing market.
The investigation also revealed ongoing concerns about product availability. More than half (57.9%) described current buy-to-let product choice as ‘limited’, while a further 24.8% said it is now ‘very limited’.
However, Landbay said product availability has already started to improve in the market in recent weeks, with lenders beginning to reintroduce products and prices becoming more stable after the volatility seen earlier in the spring.
Despite continued volatility, landlord activity remained high. Almost half of respondents indicate that they have taken out a buy-to-let mortgage in the past month (25.6%) or are currently taking out a mortgage (24.1%). Landbay said this showed that landlords remain active and engaged in the market, even during periods of relative disruption.
More than 82% of respondents indicate that they used a broker from the start when taking out their last mortgage, while almost 10% first tried to arrange financing themselves before turning to an advisor to complete the process.
The lender said the results show that the market is complex and that rapidly changing circumstances increase the value landlords place on professional advice.
While competitive pricing remains the key factor that landlords expect from lenders, the research shows that there is now an increasing emphasis on certainty, consistency and communication.
More than two-thirds (66.2%) said competitive rates remained most important, but 44.4% emphasized certainty once a mortgage offer was made, while 36.1% said stability of pricing during the application process mattered most. Another 34.6% cited consistent product availability as an important requirement.
The research also found that 39.8% of landlords experienced no problems with their most recent mortgage application. However, a significant proportion reported having to quickly switch to safe products (27.8%), experiencing delays due to changing market conditions (19.5%) or having to switch products during the application process (18.8%).
Landbay said these findings again reinforced the value of advice in helping borrowers navigate a more operationally complex lending environment.
Rob Stanton, Landbay sales and distribution director, said: “The aim of this part of our research was to understand how landlords have dealt with the volatility and uncertainty we saw in March and April, and whether this has materially changed confidence, activity or lending behaviour.
“What emerges very clearly is that landlords remain active and involved in the market, but that they attach much more value to certainty, consistency and communication from lenders and advisors.
“While rates remain incredibly important, landlords also want confidence that products will remain available, that business will run smoothly and that they can trust lenders to support them through periods of market volatility.”