Challenger puts focus on bigger landlords
ONESAVINGS BANK said its focus on bigger, professional landlords helped drive a surge in buy-to-let applications during the first half of 2017, even as the broader market has lost its sheen for amateur landlords due to tax and regulatory changes.
OneSavings, one of the banks aiming to challenge Britain’s ‘Big Five’ lenders, said last year that it had increased its focus on professional landlords and tightened lending criteria for financing smaller developments after the Brexit vote.
Traditionally, 90 per cent of Britain’s buy-to-let market has been owned by amateur investors, however a string of tax and regulatory changes announced last year have made the sector less attractive to such ‘dinner party’ landlords, paving the way for larger institutions to grab market share.
“The buy-to-let market will in my opinion definitely shrink this year; where the market is falling away is the dinner party landlord because of the taxation changes and the additional stamp duty,” CEO Andy Golding said. “I think that side of the market is put off and will slow the growth.”
OneSavings on Thursday reported a 20 per cent jump in firsthalf underlying pre-tax profit and said the impact of regulation would further shift buy-to-let activity towards its target market of larger landlords with 50-200 properties.