Many BTL brokers still in the dark about looming portfolio changes

Many BTL brokers still in the dark about looming portfolio changes
With the PRA deadline looming, now is the time to buff up on the new rules and make sure clients are ready to comply

New research from Kent Reliance has identified that approximately half of brokers are comfortable that they fully understand what the upcoming PRA changes for portfolio landlords entail, and what they will mean for their business.

The changes, which were announced in September 2016, will see a new minimum underwriting standard introduced for landlords with four or more properties as of 1st October 2017. Under the new rules, portfolio landlords, and their brokers, will need to provide detailed information on the cash flows and costs arising from multiple tenancies.

However, with less than a month until the deadline, the survey of more than 200 buy-to-let brokers found that 46% still don’t understand everything they need to. One in ten (13%) admitted that they were aware of the changes but not when they are coming into effect, while nearly a third (31%) had heard of the new rules but didn’t fully understand how to apply them to their business and just 2% had not heard of them.

Those brokers that are already in the know are optimistic about the opportunities the new framework will create. A third (29%) believe the PRA rules will increase future opportunities compared to 14% who think it will reduce overall buy-to-let transactions.

Whatever the eventual outcome, some teething pains are expected. A third (29%) anticipate that more applications will be rejected in the short term, a quarter (23%) believe the extra administrative burden will cause the application process to slow down, with just 4% predicting that it will have no impact at all.


Adrian Moloney, Sales Director at OneSavings Bank, said: “Brokers have had to get to grips a with a huge amount of regulatory change over the past 18 months including seismic changes to mortgage tax relief and stamp duty, so it’s understandable that some are still playing catch up, but with the PRA deadline looming, now is the time to buff up on the new rules and make sure clients are ready to comply.

The new standards are business-as-usual for us as a specialist lender, but we know that brokers are going to have a lot more work on their plates, so we’ve done everything in our power to make life easier. Whether that’s through communicating our new lending criteria well in advance of the changes, or developing a dedicated tech-platform, brokers ease of doing business with us remain a key priority of ours.

For those that still don’t feel confident in what these changes mean for their business, the time to get on top of it is now and we would encourage them to contact us as soon as possible so we can make the transition into the new landscape seamless for their business.”

Join our mailing list:

Leave a comment



Latest Comments

Kelvin Lloyd
Kelvin Lloyd 09 Oct 2017

IT is up, to the Planners. If they will only give permission for bungalows on certain (suitable) sites, they will be built.

view article
maggie swift
maggie swift 09 Oct 2017

It's just the beginning of the shocking rise.

view article
maggie swift
maggie swift 09 Oct 2017

I have recently read that the bungalows can provide social housing for elderly residents in London.

view article
zoe glover
zoe glover 05 Oct 2017

Update! Worst company I have ever dealt with. Undervalued a Cambridge property by over 100k, wont take on any evidence of valuation including a RICS valuation done 3 years ago for the very same value...

view article
Paul Edwards
Paul Edwards 27 Sep 2017

Its nonsense articles such as this that make it harder to get clients to realise just how difficult the market is out there. When you see Rightmove and there are more 'price reduced' then 'new' most days...

view article
Tom Allen
Tom Allen 20 Sep 2017

Absolutely agree with you!

view article
RyanGeo
RyanGeo 18 Sep 2017

A sharp correction would be a less dramatic expression to use. That is already underway in certain sectors in Reading where I practice as Chartered Surveyor

view article
sean benton
sean benton 01 Sep 2017

Identity theft is a thread for any profession. So,people should stay alarmed. I once take help from a letting agent and came to know that letting agents are taking every precaution to prevent fraudulent...

view article
Mark N.
Mark N. 30 Aug 2017

We have seen a surge in instructions over August and that should continue into September too.

view article
Chris
Chris 30 Aug 2017

Unfortunately, all the legislation bears its force on Landlords and ignores, naively, the effect of Rogue Tenants on the ability of landlords to keep houses in repair and offer properties for rent at reasonable...

view article
Christian Donovan
Christian Donovan 18 Aug 2017

The write-down on house values, combined with the fall in the GBP saddled the fund?s property portfolio with a 1.4% loss in the second quarter. The shocking amount of $240 million.

view article
Samantha Goodman
Samantha Goodman 11 Aug 2017

Interesting point of view.

view article

Related stories

More articles from Finance