Blog post
July 17, 2023

What does complex Buy-to-Let look like?

By Sophie Mitchell-Charman, Commercial Director

If you were to be glib when answering the question posed by the headline, you could say ‘all Buy-to-Lets are complex in this market!’

But I’m not going to be glib; partly because of our new Buy-to-Let rates which promise to back your landlords back into the market after a challenging few months. 

And also because complex Buy-to-Let is a classification we use a lot, especially to describe ourselves as a specialist in your complex deals. 

As the market looks to move forward into the new normal I keep talking about –  where landlords are encouraged to stop holding off and start meeting their ambitions again – how do we classify complex Buy-to-Let, and what role will it play in the coming months and in meeting increased rental demand? 

Defining complexity

There are lots of factors that can contribute to making a Buy-to-Let deal ‘complex’, but off the shelf definitions could include: 

  • Complex company structures and solutions for HMOs and MUFBs
  • Holiday Lets
  • Expats and Foreign Nationals
  • Semi-Commercial
  • Tier 3 
  • Further advances.

Realistically it is a profile of property, location and borrower that may require us to spend more time on the deal. 

The crucial thing though is that as we re-embrace the Buy-to-Let market that we don’t lose sight on what these deals can offer to the housing market and to portfolio landlords; and lenders need to be equipped to deliver them. 

What complexity will continue to offer

Recently we published a piece talking about the opportunity presented by HMOs and MUFBs in the future Buy-to-Let market, and that’s where a lot of these opportunities will come from, for a couple of reasons. 

Firstly, demand for rental properties is high, this places an emphasis on volume of high quality rooms to meet this demand. Across our bridging range we’re seeing heavy demand for refurbishment finance that supports the restructuring of properties into HMOs to meet this demand, and larger ones will play a large role in meeting this demand. 

Crucially as well HMOs are an important part in diversifying a portfolio and mitigating pressure on increasing prices. 

Mortgage bills, energy bills:- when evenly distributed among multiple tenants this lessens the burden on them and improves their affordability, while landlords can be comfortable in bills being paid. 

This approach also lessens risk from having a property unoccupied as there are multiple rental streams. 

Lenders approaching complexity 

What a strong Buy-to-Let offer needs then is an internal structure that supports your ‘Standard’ Buy-to-Lets, and complex ones, which allows operation teams the flexibility to put their resources where necessary. 

Our approach – as ever – is to underpin our entire approach with technology, and a growing team of experts to work each case. 

The technology speeds up the dull stuff – searches, documentation, etc – and frees up underwriters and case managers to fully consider the details of each case. 

Powered by technology, delivered by experts is a line we go to a lot, but in the case of bringing Buy-to-Let back and meeting the rental demand, it is essential. 

To see our new Buy-to-Let rates, download our rates guide and get instant quotes, visit our Buy-to-Let page.