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UK landlords sourcing buy to let finance from intermediaries has increased as they regard it as the best way to secure a good deal, new research suggests. There has been a 6% increase in landlords who prefer get property finance from intermediaries and large scale landlords more likely to make exclusive use of intermediaries, according to the latest report from specialist buy to let firm Paragon Mortgages. The Private Rented Sector Trends survey, which has been tracking landlord confidence and views on the buy to let market for 20 years, also shows that 60% of landlords agree intermediaries are valuable in finding the best buy to let deals. More than a third, 36%, of landlords in the fourth quarter of the year preferred to source buy to let finance exclusively via intermediaries, a 6% increase over the past three months, up from 30% of landlords in the third quarter. In comparison, 23% of landlords in the last quarter of 2014 preferred to source buy to let finance directly from lenders, and 23% sourced through a mix of intermediaries and lenders, which reduced from 28% in the third quarter. Large scale landlords, those with five or more properties, were more likely to prefer to source all their buy to let finance via intermediaries at 40% compared with 23% of small scale landlords. Small scale landlords on the other hand were almost twice as likely to source buy to let finance directly through a lender at 35% compared with 19% of large scale landlords. Some 60% of landlords agreed that intermediaries provide a valuable service in finding the best buy to let deals, in comparison with only 6% who disagreed. Additionally, 42% of landlords surveyed said that sourcing directly though a lender is only suitable for the simpler buy to let propositions. ‘Although the market has seen strong growth this year, many landlords remain cautious, particularly in view of interest rate expectations, the weaker conditions that we have seen in the housing market and the disruption we are likely to see around the general election in 2015,’ said John Heron, managing director of Paragon Mortgages. ‘When combined with the positive benefits that professional mortgage advice can bring, it is no surprise to see landlords turning more to the intermediary sector in less certain times,’ he pointed out. ‘Landlords, especially those newer to the market, recognise the benefits of using a trusted, experienced and knowledgeable broker to help source their finance. Brokers have always been key to the buy to let mortgage market and will continue to be, going by this research, for as far ahead as we can see,’ he added. Continue reading →
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