The allure of incentivised lending for properties with higher Energy Performance Certificate (EPC) ratings is certainly escalating. Alongside growing residential awareness, interest and action is also increasing within the landlord community, especially on the back of upcoming legislative changes. This has been said many times but – in light of some upcoming findings – it certainly does no harm to reiterate that, from 2025, all newly rented properties will be required to have an EPC rating of C or above. Currently, properties only require an EPC rating of E or above. Existing tenancies will have until 2028 to comply with the new rule changes.

So what about those BTL properties with a rating of D and below?

According to government figures, the supply of private rented housing in England has fallen by almost 260,000 over the past five years. A new report by Capital Economics warns that, without further action, the deficit could begin to snowball. The report, commissioned by the National Residential Landlords Association, observes that Government targets would amount to the need for 340,000 new homes a year across the UK by the middle of the decade.

Given that renting privately is the first tenure for nearly all young people, demand is only set to increase as the 15–24 age-bracket is forecast to grow by 866,000 (11%) between now and 2030. Modelling by Capital Economics suggests that without changes in tax or other policies, the private rented sector stock will decrease by a further 540,000 properties over the next ten years.

With international travel restrictions still hampering the plans of many Brits, and the appeal of holidays and short breaks across the UK still very much in vogue, this is a trend which has certainly not escaped the attention of landlords from Land’s End to John o’ Groats.

The rise of the short-term let and holiday let markets has created some appealing opportunities for landlords to generate stronger yields as the ‘staycation’ boom continues to generate heightened demand.

Recent analysis from Moneyfacts shows that there are now 231 buy-to-let mortgages eligible for holiday lets, a 25% increase in the number of available deals available since September 2021. Looking further back, in August 2020, there were just 74 similar deals available.

Analysis of Company House data from Hamptons showed that there were a total of 47,400 new buy-to-let companies incorporated in 2021 across the UK. This is reported to be almost double the number that were set up in 2017, when it was announced that investors with properties in their personal names would no longer be able to claim mortgage interest as an expense. While the number of buy-to-let companies up and running in the UK passed through the 200,000 mark as the country emerged from the first lockdown, by 2021 this figure has risen to a new total of 269,300.

The 2022 Mortgage Strategy Awards are taking place at the end of May and Dynamo for Intermediaries is nominated in the following category:

Best Specialist Broker/Distributor

We'd be very grateful if you would consider giving us your vote. Visit https://mortgagestrategyawards.co.uk/msa/en/page/industry-vote before Friday 28^th January – it only takes a minute.

In recent times, the remortgage market has taken a back seat to a purchase arena which has crackled and popped with activity over much of 2020 and 2021. However, is 2022 set to be the year of the remortgage?