Advice from brokers will be vital to help landlords maximise their returns in the Buy-to-Let market, according to research from Alliance & Leicester Mortgages.
According to brokers, landlords will continue to turn to them first and foremost for qualified advice (59%), then for exclusive Buy-to-Let deals (20%) and great rates (11%). It is evident that brokers play an important role in helping the Buy-to-Let investor make the right purchase decision to maximise profitability. With the right advice, brokers predict that over a third (33%) of all investor landlords could make an operating profit in 2008 while 43 per cent of professional landlords could achieve a positive net yield.
Mark Blackwell, Director of Intermediary Sales at Alliance & Leicester, said: "Investing in Buy-to-Let properties should be seen as a long term investment. Despite this, brokers expect nearly 80% of landlords to make a positive return on their investment this year."
According to the research, brokers cite the principal stumbling blocks for the buy to let market as being the fluctuating base rate (32%) and cooling house prices (27%). One in ten of brokers (10%) however, expressed a concern that rising house prices are reducing the rental return on properties, which could cause difficulties when landlords come to re-finance.
Mark Blackwell continues: "The buy-to-let market will continue to be a significant part of the overall housing market for investors and broker sentiment indicates that buy-to-let will continue to deliver in 2008. Those with multiple properties and a higher proportion of fixed rate lending are most likely to be able to withstand any house price cooling and fluctuating base rates. Landlords with fewer properties will need to be astute in the coming months to avoid potential pitfalls, with professional advice playing a particularly important role to them at this time."
"Alliance & Leicester has a number of new fixed rate Buy to Let products that can offer budget certainty over two, three or five years and brokers can advise them to ensure they are matched with the right deal. We are confident that brokers will take a measured view when advising their clients - the cheapest rate highlighted on the market is not necessarily the best one available for their client."
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