Why we need to support first-time landlords: Q&A with LendInvest Mortgages' Sophie Mitchell-Charman

"The opportunity is there this year, we just need to be smart about it," says lender's commercial director

Why we need to support first-time landlords: Q&A with LendInvest Mortgages' Sophie Mitchell-Charman

This article was provided by LendInvest Mortgage

LendInvest Mortgages started strongly this year, with a comprehensive buy-to-let offering that brought landlords and their brokers back to the market in droves, and then launching a more advanced and simple application process for buy-to-let in the Mortgages Portal.

Given the year 2023 was for buy-to-let, you could understand many in the business - from lender, to broker to landlord - losing their appetite to back buy-to-let in a big way.

LendInvest Mortgages, and its commercial director Sophie Mitchell-Charman (pictured), haven’t seen it that way, and kicked off the 24/25 financial year with a reshaping of its buy-to-let range to benefit all landlords, but specifically target the first-time landlord.

An interesting decision given the fluctuations in the buy-to-let market recently, we spoke to Sophie Mitchell-Charman about why they are backing this cohort of landlord.

What have you introduced recently to support first-time landlords?

LendInvest Mortgages has always had a flexible policy in this area. Where we differ from most lenders is in the property type we support first-time landlords to purchase, we’ll allow a Small HMO - up to six rooms - for a first-time landlord.

Similar flexibility applies to our bridging range as well, with support for first-time investors across our range, we’re really well placed to encourage would-be landlords to make that first purchase.

So to back them with that, we’ve recently introduced a limited edition offer of free valuations on Small HMOs up to £500k. It’s available for all landlords but we want to see first-time landlords really take advantage of this.

Why are first-time landlords so important?

Like any industry, you want a flow of new blood entering it to provide new ideas and keep it fresh. Renting is changing and the market needs to evolve to support it, through the properties and flexibility lenders offer, and the landlords delivering high-quality homes for customers.

Rent and house building will be a huge part of an upcoming general election. A healthy housing market in the UK will be one that gives customers a choice between affordable rents and affordable homes, so they can have the flexibility to live their lives how they like, and only by having a vibrant rental market can we deliver that.

What’s happened in the buy-to-let market so far this year?

In some ways, 2024 so far has been a rushed example of buy-to-let over the last few years.

January – Boom time, with lots of buyer activity as lenders across the board put out cheaper rates to encourage landlords back into the market.

February/March – A slow down and course correction as volatile swap rates force lenders to increase their rates.

However, unlike in the last few years when swap rates caused landlords to basically withdraw from the market, we’ve seen activity remain steady.

For starters, the volatility we’ve seen so far this year is nothing compared to the 2022/2023 period.

But aside from that, landlords are displaying new found confidence in the market. They sat out and watched it move throughout the last 18 months, but seem to have now decided this year is the one to get back into it or – in a growing number of cases – start new careers in the space.

What do you think the outlook is for the rest of the year?

We’re seeing lots of ambition to return, but a bit like that spike of activity all lenders saw in January, there’s an argument the business will be done in flurries throughout the year.

Swap rates remain a constant talking point when designing products, but I think like when lenders dropped their rates in the new year, we’ll see these opportunities emerge quickly, rates move and landlords be prepared to dive into the market with two feet.

What will set lenders apart throughout this then, will be the ability to work quickly to support their customers to take advantage of when the time comes.

That’s why we’ve invested so much into our technology and bringing buy-to-let into the Mortgages Portal. It’s a comprehensive system which allows us to release new products quickly, receive applications in no time at all and give our experts the tools to process deals alongside consumer demand.

The opportunity is there this year, we just need to be smart about it.