Newly released data from secured property lender, Fitzrovia Finance, has shown that 54% of buy-to-let landlords have been affected by recent tougher tax treatments and tighter bank lending criteria, with many selling and reducing their property holdings.
One in five of those interviewed said they have reduced the number of buy-to-let properties in their portfolios, and 15% said they were deterred them from buying more properties.
Of those interviewed that have sold buy-to-let properties over the past two years, the average cash released from the sale was £129,746.
In addition, the findings reveal that some of these property investors are increasingly turning to real estate investment platforms as a good alternative to invest. Of those that have sold a buy-to-let property, 8% said they used the funds to invest through property debt investment platforms. One in three believes that as the buy-to-let market has become less attractive, they will use property debt investment platforms more.
These sophisticated property investors are clear on what they want to see in a property debt investment platform before using one. The most important feature is the offer of attractive secured property lending opportunities. They also value new regulations making the sector safer and more transparent.
Features that would motivate landlords to start investing through property investment platforms and BTL investor percentage:
1: Attractive secured property lending opportunities 33%
2: New regulation that will make the sector more transparent and safer 29%
3: Trust in the company’s management team and track record 28%
4: Attractive risk -adjusted returns 26%
Brad Bauman, CEO, Fitzrovia Finance said, “Property debt investment platforms are a good alternative for landlords who understand the asset class and the risks involved. As the buy-to-let market becomes less attractive, our research suggests that many may increasingly turn to property debt investment platforms for attractive risk adjusted returns but without the hassle of managing tenants or carrying out costly maintenance.”