A specialist mortgage operator is warning letting agents and landlords to gear up for a winter of discontent as a result of a flurry of challenges.
Private Finance says there’s likely to be a slew of bad publicity for the rental sector if there are substantial numbers of evictions once the ban ends on September 20, while mortgage rates are rising and are likely to discourage new landlords.
To avoid some of these difficulties there may be many landlords who will sell up, while buy to let products – especially mortgages – are likely to be in less demand in the months to come.
These problems are because of a flurry of events in the next few months – falling rents in London because of the pandemic, Brexit confusion if No Deal remains likely, the end of the evictions ban, and the winding down of the furlough support through the Coronavirus Job Retention Scheme.
“June and July were our busiest months on record and this also spilled over into August, following this spike created by the Stamp Duty Holiday in combination with the re-opening of the housing market. However, demand now seems to be levelling off with enquiries for mortgages for purchase down on July so far this month” warns the mortgage firm.
It continues: “The uncertainty in the economy and the housing market never went away and we may see the market readjust itself to reflect the new economic reality over the coming months.”
And it cautions that the higher loan-to-value segment of the market is in a state of flux currently, both for buy-to-let and residential purchases, and the rates are correspondingly high reflecting the uncertainty in the market and the potential for significant falls in property prices.