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Property investors expand portfolios despite difficulties

Posted: February 24, 2018

Lenders have reported an increase in bridging loan and commercial mortgage applications for property investors, who are expanding their property portfolios according to a February 2018 Mortgage Introducer article.

There is continuing ambiguity about how Brexit will affect the economy. Landlords have been hit by the raised 3% stamp duty and cuts to tax relief on mortgage interest payments, and new affordability rules have made it more difficult to obtain a mortgage for buy-to-let landlords with more four or more mortgaged properties. Most investors do not feel that conditions will improve in the short term.

Despite these difficulties and uncertainties, property investors remain resilient and are continuing to invest. Many buy-to-let landlords are diversifying their property portfolios by purchasing commercial and semi-commercial property.

Some commercial property investors are looking outside of London to expand the number of properties they own. London prices are considered too high by these investors, who note other regions, especially in the North of England, with more affordable properties. Some investors are also looking outside of the UK for suitable investments.

Bridging finance is a being used by many investors to purchase property, especially as a short-term measure while waiting for more long-term finance to be arranged. The speed at which bridging loans can be arranged makes it easier to complete time-sensitive property deals.

There are plenty of commercial mortgage and bridging finance products available for property investors. A bridging and mortgage broker can match the borrower’s requirements to the best loan deals so that investors can continue to expand.