Rightmove or Zoopla?

Whether you’re looking to sell your property or on the search for a new one, you’ll more than likely use a property portal. With Rightmove and Zoopla both being the two big names at the moment, it can be hard to know which is right for you.

In recent years property portals have quickly become an unavoidable part of the property buying and selling process. For sellers, knowing the right place to market your property could make all the difference and for buyers, not wanting to miss out on the property that may just be the one, knowing where to look is key.

Know the stats:

When selling a property, something important to consider is how many potential buyers you are able to showcase it to, because, the more people that see your property the higher the chance of it being sold. When looking into property portals, knowing the number of monthly site visits is a good place to start. Rightmove and Zoopla both have huge numbers of monthly website visits, however, Rightmove are considerably ahead on this figure with an average of almost 100 million visits per month, whereas Zoopla currently have an average of nearly 36 million site visits per month, these are over the past 6 months.

If on the other hand you’re looking to buy, then a more helpful figure to know would be the number of listed properties a property portal has. Rightmove typically have more properties listed than Zoopla do, however, this is not to say the one with less listed properties should be ignored.

On the Market is a rising property portal originally started by estate agents across the UK, On the Market insist that their members advertise properties on either Rightmove or Zoopla, they cannot advertise on both, therefore, even though Rightmove has a greater number of listings doesn’t mean it will have the property you’re looking for.

Stand out features:

Of course both Zoopla and Rightmove have many helpful features, they both have downloadable apps available and, provide information on property prices and will link you to agents. Rightmove does offer a handy price comparison page and information on market trends as well.

Though, Zoopla does take the lead when it comes down to the tools offered for buyers and sellers. Zoopla provides an accurate valuation estimate for your property, they also offer a feature that allows users to see how a market is performing within specific postcodes over a period of up to 20 years, users can see when a market has gone up or down and can view the average change, this is especially useful to property professionals trying to gage the strength of a local market.

Amongst a few other clever tools, they have an interactive map for users to define their search area and, a travel time tool for locating properties that are for example, a 15-minute drive to a certain school address.

There is no one Property portal better than the other for the reasons stated above, choosing which to use or if to use both is determined by your situation and what you are trying to achieve, so hopefully after this article, you will be able to make a more informed choice.

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Contact Pivro

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With 2020 behind us, we can finally breathe a sigh of relief and look forward to a new, more profitable year in the UK’s property market. Or can we? With the pandemic still a major focus with no real end in sight, and the effects of Brexit beginning to be felt throughout a wide range of industries, including the property market, 2021 could be just as challenging a year for estate agents and property professionals alike..

Technology To The Rescue

Fortunately, today’s technology is here to make our lives, and our businesses, more efficient, more productive, and more sustainable. During the pandemic lockdowns, many businesses were forced to change their daily operations, while others were forced to shut down completely. For those still open and operational, technology made running their businesses a reality as we saw the use of more virtual technology such as Zoom and other communication platforms.

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Virtual Communication Platforms

These virtual communication platforms connected co-workers with co-workers, sales professionals with clients, business owners with their work from home teams as well as their vendors, manufacturers, and shipping partners. This still left a gap in their daily workflow, which became even more complicated in the absence of actual workers. Estate agents and property investors could effectively view or tour properties using virtual technology without ever having to leave their home or office.

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Business Automation Software

This is where business automation software would step in to streamline many of the daily processes, acting as an entire team of employees while freeing up actual employees to focus on other, more important tasks. Business automation software can send emails, exclusive offers, and more to potential clients, generate and manage property leads, and automate a wide range of mundane tasks.

Pivro offers today’s estate agents and property professionals an innovative automation software package which enables them to send mail to people that are on the market trying to sell their property. By engaging with potential property sellers before the competition can, estate agents and property professionals can increase their business and reach their sales goals sooner.

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Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

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There may be uncertainty over whether property values will increase or not next year, but one thing is clear – the property market is about to undergo many changes this year.

The first is the end of the current Help to Buy scheme and which will be replaced with a new version aimed at only first-time buyers (whereas the current scheme was extended to other buyer groups). There will also be regional price caps, meaning developers won’t be able to put inflated prices on New Builds. This is a move which obviously has positive benefits for the first-time buyer – although whether it will put off developers building the homes the UK so badly needs, remains to be seen.

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Overseas buyers to face property surcharge

The second major change for the property market is the 2% surcharge for overseas buyers in April – a move that is expected to affect Central London property in particular.

In the same month the government’s Furlough scheme ends and, although not directly linked to the property market, it is expected to lead to increased unemployment and uncertainty. That will certainly hit the number of property sales and, in turn, the cost of bricks and mortar.

And finally, although nothing has been put in writing yet, there is serious speculation that Capital Gains Tax (CGT) will increase this year. A move which will have serious implications for portfolio property investors as well as accidental landlords.

2% surcharge for overseas buyers

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Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

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The UK property sector is facing a lot of challenges and uncertainties in the coming months. The COVID-19 and numerous lockdown measures have created a sluggish economy and poor demand for housing. On the plus side, the UK government is successfully completing its plan to completely cease lockdowns and housing demand should start to pick up this year.

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Business professionals have relied more on digital technology since last year and investors in the UK property sector will use these technologies even more this year:

Big Data- real estate businesses should collect ample raw data to ensure more accurate analytics. As an example, it is easier to pick out consumer behaviour and market trends. Estate agents must know who their customers are. It is also useful to know how, where, and when customers will purchase properties.

AI And Machine Learning- both technologies allow computers to make accurate decisions through pattern recognition or previous events. Based on algorithms, AI may recommend certain actions, so investors can gain higher returns, manage risks, and control expenses effectively. Property investors can factor in their parameters into the AI algorithm to make more accurate predictions and decisions.

IoT- estate agents should incorporate the Internet of Things technology to their properties to enable smart homes and home automation. This is a game changer in the UK property sector. All components are assigned with IP addresses, allowing complete controls. With a smart home infrastructure properly set up, homeowners can make further improvements based on their requirements and preferences.

VR- with VR, customers can inspect a property remotely, as if they are actually there. UK property investment businesses may use VR to give prospective buyers a feel of the property virtually. For potential buyers, this is a big time saver, and more people will inspect the property virtually. If the property is still under construction, prospective buyers can examine the digital mock-up with VR.

Automation Of Operation- investors can remain competitive by being more efficient when differentiating market position. Back-office operations are more productive and robust with automation. The system may automate facilities, portfolio, and customer relationship management. Investors can appeal to stakeholders better by ensuring good cost efficiency.

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Pivro’s Marketing Automation Software

While all of this technology sounds appealing, it can be quite challenging to use effectively. However, with Pivro’s marketing automation software for property professionals, growing your pipeline is easier and more effective than ever. Pivro’s marketing automation software enables you to send targeted marketing, create high response letter templates, analyse and manage deals, and more.

As you can see, there are a wide range of benefits today’s property investors and estate agents can gain by choosing Pivro’s marketing automation software. Contact Pivro today to see what their marketing automation software can do for you.

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Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

The average UK house price has been growing steadily for many years but, recent political and economic factors have people wondering whether we are in for a housing market crash in 2022.

Interest rates are at a record high. That affects the ability of prospective buyers to afford mortgage rates. And homeowners with tracker mortgages that are linked to interest rates, may also find it increasingly challenging to meet their mortgage repayments.

For anyone wanting to get on the property ladder as first time buyers, it's a daunting time to sign a mortgage deal with the prospect of rising mortgage rates, big deposits being required, and uncertainty about a looming recession.

The Bank of England has predicted a recession in the last quarter of 2022, as soaring inflation and the rising cost of living in the UK affect the daily lives of the nation.

It's understandable then that there is concern about the future of the housing market. Particularly given that the 2008 recession resulted in house prices plummeting.

However, despite this concern, most experts predict that while there may be cooling of house price growth, there is still strong demand for property and limited housing supply. That means that a house prices crash is unlikely.

The average house price in the UK is £283,000, according to the Office of National Statistics (as of May 2022). This reflects an annual average house price growth of 12.8%, compared with the preceding year.

But by June, data from the UK House Price Index showed that house price growth is slowing, in addition to there being fewer property transactions taking place.

Below we look at the current state of the housing market in the UK, the predictions for the property market in 2022, and what's in store for house prices in future.

What's the current state of the housing market in the UK?

When it comes to assessing the current state of the housing market in the UK, there are several metrics to bear in mind.

The first is average house prices in the UK, which have been steadily increasing for several years. This annual growth in house prices is also an indicator of state of the property market.

Other factors to bear in mind are current interest rates (which are on the rise), the availability of mortgage finance, and the affordability of housing compared with average salaries.

It's also worth looking at housing stock, household finances and disposable income. And when it comes to assessing the market as a whole - it's important to also look at the buy-to-let market, the size and growth of the rental sector, and average rental prices to get a general overview of the property market as a whole.

And finally, to understand property markets, it's important to also understand the current political and socio-economic climate, geopolitical tensions and other global economic trends.

There can be a mix of factors that can lead to a housing bubble, cost of living crisis, a property market downturn and ultimately a property crash.

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Average UK house prices in 2022: an overview

Average house prices in England for August 2022 are £365,173, according to the Rightmove's House Price Index.

Combined with high interest rates and a population struggling to afford the current living expenses, this average price makes it quite challenging for first time buyers to get onto the property ladder and to purchase a property.

And although interest rates in the UK have historically been very low, which has made borrowing for a mortgage relatively inexpensive - there have been some sudden and big increases to interest rates of late.

That means that many people with mortgages will now be paying higher rates (unless they're on fixed rate mortgages). And anyone needing to remortgage their home may not find as attractive mortgage deals as in the past.

It's likewise important to bear in mind that property purchasing patterns changed during the pandemic. Many people chose to buy property away from big cities - as a result of increased remote work options.

And there's been a shift in the type of properties that are in demand, compared with pre-pandemic.

In addition, the government's recent Stamp Duty holiday meant that many people were incentivised to buy properties over the course of the last 2 years.

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Overview of the UK property market

The UK Land Registry's House Price Index, which is based on sales prices, shows that average house prices rose by 7.8% over the last year. Based on actual sales over the last year, the average home value is currently £286,397 (as of June 2022).

And more recently, according to Rightmove's House Price Index, "national average asking prices have more than doubled (+134%) from £155,994 to £365,173" since the Index was launched 20 years ago.

But there are signs that the growth in house prices in the UK is starting to slow down.

This is a combined result of the increased cost of living, rising inflation, increasing interest rates and higher mortgage rates.

Rightmove's Director of Property Science, Tim Bannister, says:

“Several indicators point to activity in the market continuing to cool from the lofty heights of the last two years.

It’s likely that the impact of interest rate rises will gradually filter through during the rest of the year, but right now the data shows that they are not having a significant impact on the number of people wanting to move.

Demand has eased a degree and there is now more choice for buyers, but the two remain at odds and the size of this imbalance will prevent major price falls this year."

In addition to average house price growth slowing, there is also a slight easing of demand when it comes to property purchases. On the flip side, there is increasing rental demand, a diminishing supply of rental properties, and an increasing number of renters across the UK.

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2022 UK housing market predictions

Multiple factors are contributing to fluxes in the UK housing market. Global political tensions, domestic politics, the onset of an imminent global recession, the recent cost of living crisis in the UK, rising interest rates - together with soaring inflation - could all culminate in a UK house market crash in 2022.

But what research and data is there to support this prediction?

According to Knight Frank's Intelligence Lab:

"Supply is rebuilding more gradually than anticipated, which means price growth is expected to end the year in high - rather than mid-single digits."

Knight Frank also predicts that by the end of 2022, supply will be building and demand will be constrained by rising mortgage rates and high inflation.

Knight Frank also forecasts that the annual house price growth will reach 8% by the end of 2022, before slipping to 1% in 2023. By comparison, Rightmove forecasts that house prices will rise nationally by 5% by the end of 2022.

Zoopla also predicts similar smaller increases in average house prices and say they "expect to see a decrease in demand for homes in aspirational rural or coastal areas in the next few months."

Lawrence Bowles and Ed Hampton from Savills similarly report on the market's current momentum being retained, but foresee that this will likely slow as economic challenges mount. They also note that "demand is being tempered by increasing affordability challenges" and that interest rates are expected to keep rising.

And finally, according to EY's UK Chief Economist, Peter Arnold:

“There are certainly a number of signs pointing to slower house price growth though. The ratios of house prices to average incomes, and of average mortgages to incomes, are already at record highs, for example. An increase in the cost of living may also prompt some prospective buyers to become more cautious or to struggle to afford a deposit.

“But the squeeze on demand is being counterbalanced by a continued squeeze on supply and even a significant, sustained expansion in housebuilding would be unlikely to have a material impact on average prices.

Meanwhile, rising interest rates are unlikely to affect homeowners in the same way they would have done previously, with the dominance of fixed-rate mortgages meaning rate changes will take some time to filter through to borrowers.

Crucially, the economy is also not seeing the high levels of unemployment that have been a key factor in previous house price contractions.”

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Will property prices crash in 2022?

It's of course difficult to predict what the future will hold.

And given uncertainty about current geopolitical crises, domestic political turmoil, the energy crisis, and whether the UK will enter a recession - it's even more challenging to make predictions as there are so many variables.

However, many experts think that a UK housing market crash in 2022 is unlikely.

That's because there is still strong demand to purchase property and a dearth of available properties coming onto the market. These factors help to keep prices stable.

But, although there may not be a market crash in 2022, there are signs that the property market is going to experience much slower growth than in the past.

That is linked with the current rapid rise in energy prices, rising inflation, and general cost of living increases. Many people just won't have the capital to put down deposits or the disposable income to afford mortgages.

As average house price growth stagnates, capital appreciation for property may be slower than in previous years.

That means that if you were hoping to buy a property at a reduced rate by the end of the year, that may not happen. Most experts are not predicting a significant fall in house prices over the medium or long term.

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What's in store for house prices in future?

A variety of experts have weighed in on the future of UK house prices.

UK estate agency, Knight Frank, has predicted in their 5-year sales forecast that average house price growth will reach 1% for 2023, 2% in 2024, 2% in 2025, and 3% in 2026.

How the housing market will play out in 2023 and beyond, remains to be seen.

It's particularly challenging to predict that far into the future, given the number of socio-economic and political changes happening in the world. The COVID-19 pandemic has shown us how economies can be rapidly transformed.

In the short term it appears likely that average property prices will remain in an upward trend, albeit slower growth than usual.

But if inflation continues to rise, and as more households feel the pressure of the cost of living, economic growth could slow too. And as interest rates rise, this may also add pressure to already constrained prospective buyers.

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If there were a house market crash, how would people be affected?

If the UK property market were to crash, there are many impacts that would be felt by investors, developers, home owners, landlords, tenants, estate agents, lenders and anyone with a vested interest in the UK economy.

For starters, banks who had lent people money for mortgages may struggle to recover those funds. That may result in banks no longer being able to issue many new loans.

This may hamper business investment and could also reduce public spending, triggering a recession (if there wasn't one already). This could wreak havoc with financial markets, and unemployment may rise as a result.

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How to use Pivro to uncover property market insights

If you're looking for the latest property market insights to determine the best area to invest in, to find the best buy-to-let area, or to find house price sales comparisons - then Pivro's AI-powered property analytics platform can provide a solution.

While Pivro may not be able to predict a property crash, it can provide real-time information about the property market.

Curating multiple data sources on one easy-to-use platform, Pivro is able to provide some of the most insightful market research data in the UK.

For example, you can search areas for properties based on sale values, rental yields, and return on investment. This can help you make smarter data-driven property decisions.

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Final thoughts on the future of the UK housing market

If you're an investor considering purchasing the perfect buy-to-let property, a first time buyer looking for your dream home, a property developer looking for opportunities to create good return on investment or a homeowner paying off a mortgage - then you're most likely very interested to know if we're in for a housing market crash in 2022.

There are a myriad of factors that have led to the global economy being on the precipice of recession. In the UK, these factors include current geopolitical tensions, economic recovery from the pandemic, soaring energy prices and spiking inflation. All of these factors have culminated in a cost of living crisis, making it more tough for people to afford to purchase property.

For now, most experts are of the opinion that the UK isn't in for a housing market crash, although some cooling of house price growth is inevitable.

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Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

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DISCLAIMER: Please do not consider this tax, financial, mortgage or legal advice. We’re simply sharing general information, and we highly recommend you speak to a registered and qualified professional about your individual circumstances before making any decision based on the information provided on this website.

There are many reasons why you might be looking for a UK address, house name or postcode - whether in England, Wales, Scotland or Northern Ireland. There are a variety of UK address finder tools that can help quickly locate UK addresses and a range of other property information.

Knowing which tools to use and what data they can provide helps unlock a variety of other benefits.

For example, some address finder tools can provide information about a property's restrictive covenants, tree preservation orders, or risk of subsidence.

If you're an estate agent, mortgage lender, or property investor you often need to find data and addresses for multiple properties at the same time.

Below we look at some of the tools that you can use to find a single address or multiple addresses in the UK. These tools can also help you find a postcode for an address and a range of other important property data.

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Reasons why you may want to source the full address of a property

There are a variety of reasons why someone may want to find the full address of a property.

Here are some examples:

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You’re an estate agent and you want to send out marketing material

If you're an estate agent, you may want to find the full address of a single property or addresses for multiple properties, so that you can send out marketing material directly to sellers.

Many estate agents have marketing strategies that involve sending letters to addresses of properties that have been listed on the market but haven't sold in several months.

Estate agents also choose to send targeted letters to properties that haven't been on the market, but are in areas where several neighbouring or nearby properties have sold. This can help to incentivise people to use those agents if they've been thinking of selling their homes.

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You’re an investor and you want to identify potential investments

Investors and developers are often keen to identify new potential investments to add to their portfolios. That includes finding the best buy-to-let area.

This can be time-consuming work and it's best to have an efficient process for sourcing the best deals and return on investment (ROI) opportunities.

You want to find where someone lives

Another obvious reason for sourcing the full address of a property in the UK, is to find where someone lives.

This may be because you want to track down a relative or friend who you've lost contact with. Or perhaps someone moved to a new address and you want to send them a surprise housewarming gift.

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You want to find out who owns a property in the UK

There are many reasons why you may want to find out who owns a property.

For example, you may live next-door to a house that has created a nuisance and you want to notify the owner. Or you may want to discuss a potential offer to purchase a particular property.

Or you may be interested in finding out about the previous owners of a property you're keen to purchase (particularly if there have been many quick successions in ownership which could raise red flags).

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How to find a UK address: Postcode finder and property data sourcing tools

Many people searching for a property's full address in the United Kingdom (UK), struggle with figuring out where to start and which tools to use.

While there are some free tools to find a postcode or an individual address, there are also some powerful AI-powered technologies that can provide access to an integrated range of property data. These platforms can help provide users with a range of useful services and property data insights.

Below we look at the range of address finder tools that are available:

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Tools to find individual UK postcodes

If you have an address for a property, but you need to find the correct postal code, there are some quick postcode finder tools that you can use.

These include:

• Royal Mail's 'find an address' tool
• Zoopla's full postcode finder tool

Tools to find individual properties for sale or rent in a particular area (and their addresses)

If you're looking for UK properties for sale or to rent in a particular area, this information is typically available on the following sites:

• Zoopla
• On the market
• Rightmove

Most online property marketplaces allow you to search for properties by postcode, or the name of an area (e.g. London) to find individual properties for sale or for rent. However, these sites don’t provide the full addresses of properties.

You also won't find detailed property data about easements, restrictive covenants, zonings etc. using these tools.

If you’re looking for the full address for single or multiple properties, as well as a range of other property related information - then Pivro is a suitable solution.

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Tools to search for aggregated property data (which also provide real-time property analysis data)

One of the primary benefits of using an aggregated property data platform like Pivro is that you can quickly and easily access a range of data sets related to any property in the UK - all in one place.

This type of data is particularly relevant for investors, developers, real estate agents, letting agencies, deal sourcers and conveyancing solicitors.

Here are some of Pivro's features which can help you find an address (and other related data):

Land ownership data

You can process property ownership lookups for any address in the UK at the touch of a button.

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Planning history data

You can search for planning history for a particular property in the UK to see what planning consents have been granted or applied for.

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Powerful property market analytics

Find out the addresses of properties that are on the market, have been on the market for a specified time and set your custom filters to reveal the insights that matter most to you.

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Technical property data and reports

You can also access a range of data relevant to a particular property. That includes information about survey and environmental data like subsidence risks, land contamination, water drainage, tree preservation orders and more. Or you can find general county information or area-specific data.

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Tools that provide land registry data

Another useful tool to find out who owns a property is the HM Land Registry. You can get a property summary for free, or pay £3 for a title register or title plan respectively. You'll also need to search different registers for Scotland, Northern Ireland or if you want to access the data in Welsh (Cyrmaeg)

Getting a free property summary includes the address that's on record with the Royal Mail. You can also get useful information about any easements, restrictive covenants, and the type of ownership.

A title register can give you the name of the owner, the sale price, and whether there's a mortgage in place.

A title plan can give you information about land boundaries and the property's exact location.

To access the data, you'll have to create an account using an email address and password to login.

By using Pivro's aggregated property data technology, you can access all of this information and more - all in one place.

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How to find an address location?

If you have an address, and you want to find out exactly where that is on a map, there are many digital tools you can use. That means you no longer have to navigate physical maps.

You can use Google Maps (which can also provide driving directions), the HM Land Registry, or Pivro's property tech platform.

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Other information you can access online related to an individual property

There are many other types of property data that you may be interested in finding. This includes data about:

• A property's zoning (or the zoning of areas near to a property you're interested in buying)
• Property market trends in a particular area, so that you can figure out your possible return on investment (ROI)
• Whether a particular property is currently for sale and on the market
• How much a property sold for in the past and who the previous owners were
• How long a property has been on the market (for example, an agent may be interested to find properties that have been on the market for longer than 60 days so that they can send them letters about remarking their homes)
• Whether any neighbouring or nearby properties have recently been sold and what their sales prices were ‍

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Final thoughts on how to find an address in the UK

Gone are the days when finding technical property data required relentless sleuthing and manual lookups. That means you no longer need to worry about technical search tool terms like stroke width, stroke linecap, stroke miterlimit, clip path or display bfpo locations.

There are various easy-to-use tools that can help you find addresses in the UK. And if you're looking for comprehensive data about a particular property, or properties in a designated area, then you may want to consider using a powerful property data platform like Pivro.

Pivro's platform gives you access to real-time, AI-powered and aggregated property data. It can save you time and money on manually searching through a plethora of other tools, records and resources. And it can provide relevant property insights to help you make more informed choices and decisions.

Pivro's capabilities are extensive - including being able to send out mass mail shots of personalised and targeted letters to property owners, for less than a second class stamp.

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Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

If you're interested in investing in a buy to let property, then chances are you're considering setting up a limited company to make that purchase.

There are many advantages to investing in buy to let properties, particularly when there's increasing demand for rentals and good capital growth potential.

There are also many advantages (if you plan to own real estate) in setting up a limited company - particularly for portfolio landlords. Below we look at some of these pros and cons of buying a buy to let through a limited company.

If you need finance for that purchase, then you may be looking for a limited company mortgage (specifically a buy to let mortgage for a limited company). There aren't too many high street lenders that offer these mortgages, so you may need to consult a specialist mortgage broker and look for specialist lenders that are willing to provide this type of loan.

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An overview of buy to let property investment in the UK

While no investment is without risk, the property market in the UK is expected to grow over the coming decades.

Property values have been increasing, which shows potential for long-term investment growth. And the rental market is expected to remain strong, which means that you're likely to find tenants for your buy to let (BTL) property.

Here are some useful statistics about the property market in the UK relevant for buy to let investments:

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• Expected UK house price growth: According to Statistica, the UK house price growth forecast estimates that between 2022 and 2026 there will be positive growth, settling at around 4.5% by 2026; ‍
• Increasing rental prices: According to Zoopla, rents have increased by 11% for newly agreed lets over the last year, and across the UK (excluding London), they are expected to rise by 4.5% during 2022. However, they also note that the rental market remains highly localised, although demand is still strong across the UK; ‍
• Consistent, long-term growth in UK house prices: The Land Registry's UK house price index shows consistent growth in average house prices across the UK since 1980; ‍
• High volume of tenants in the UK: According to Statistica, around a third of all UK households are private or social renters. ‍

What's a buy to let property?

A buy to let is a property (whether a detached home, terraced house, flat, HMO etc.) that is bought for the purpose of being rented out (leased) to tenants.

Investors who buy these properties usually do so to make money both from capital growth over time (as long as property values increase over time), and from return on investment through monthly rental income.

These properties can be bought if you have the finances to pay the full amount upfront. Or if you need to borrow money, they can be mortgaged to finance that purchase.

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What is a buy to let mortgage?

A buy to let mortgage is an arrangement between a borrower and a mortgage lender whereby the purchaser agrees to borrow money and repay it according to specified and agreed on terms. You'll usually need to pay monthly interest instalments and then make a capital loan repayment, but various other options may be available.

You can get a buy to let mortgage in your personal capacity, or for a limited company.

It's a good idea to familiarise yourself with mortgage terminology in the UK, so you have a better understanding of the industry.

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How does a buy to let mortgage differ from a residential mortgage?

Buy to let mortgages are different from residential mortgages in various ways. They usually have different eligibility criteria, require a higher minimum deposit, and are typically interest-only loans.

If you're applying for a BTL mortgage, you'll usually have to show that your expected rental yield will cover the costs of owning the property as well as the cost of your monthly mortgage payments.

And, unlike residential mortgages, most traditional buy to let mortgage lenders won't provide finance to first time buyers. There may be other specific exclusions to look out for too.

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Buy to let property as an investment opportunity

Developers, investors, and anyone wanting to make money often look at purchasing property as part of their diversified investment portfolios.

Purchasing a buy to let home may be a long-term investment strategy.

Or you may want to get involved in flipping properties, where you're able to buy and sell a property at a profit relatively quickly.

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What is a limited company? (and why use one to purchase a buy to let property?)

If you're planning to invest in a buy to let property, you may want to set up a limited company first.

But you'll first need to have a good understanding of the advantages and disadvantages of this form of ownership and the additional obligations that it places on you - to decide if it's right for you.

Below we look at what a limited company is and the various forms of limited companies available. We also look at the pros and cons of purchasing a buy to let through a limited company, and at how you actually go about establishing a UK limited company.

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What is a limited company in the UK?

Essentially, a limited company is a legal form of business ownership.

Compared with contracting as a private individual, a limited company provides the owners (who are usually shareholders of the company) and directors with limited liability, as the company is a separate legal entity that contracts in its own name.

For UK companies, they need to be incorporated with Companies House and will be issued with their own company registration number.

UK companies need to comply with the provisions of the Companies Act and their own articles of association. Part of this entails submitting regular returns that are publicly available on a companies register.

There are 3 types of limited companies in the UK: private companies limited by shares, public limited companies and private companies limited by guarantee - with the former being most common.

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How do I set up a limited company in the UK?

It's relatively quick, simple and affordable to register a limited company in the UK. You'll need to submit your chosen company name, together with your memorandum and articles of association to Companies House (which you can do online).

Once your application is accepted, you'll receive a certificate of incorporation and you'll then need to start complying with all the requisites of the Companies Act (such as holding meetings, issuing share certificates etc.).

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What's a Special Purpose Vehicle (SPV) and when should I use one?

Quite often lenders will require that limited companies applying for BTL mortgages set up a Special Purpose Vehicle (SPV).

A SPV is a company that is created by a "parent company" specifically to own property and is done to limit financial risks. The SPV has its own finances and balance sheet, so that if it goes bankrupt, it doesn't affect the parent company.

Properties that are bought by a SPV can then be sold or transferred by selling or transferring the SPV.

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The advantages of buying a buy to let property through a limited company

It's important to assess the pros and cons of buying a property through a limited company or SPV. There are many differences between buying a property in your personal name compared with buying it through a company, which need to be carefully considered.

Below are some of the advantages of buying a BTL property through a limited company:

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• Tax efficient

If you're a property investor (whether you have a large or small portfolio), you may find the tax benefits of buying through a limited company quite attractive.

That's because when you pay corporation tax on profits (currently 19% on dividends) it's typically less than paying income tax on personal income from renting out a property. That's particularly the case if you're in a higher personal income tax bracket.

There are also some tax-free dividends you can claim for companies.

However, you should weigh up these tax benefits with the fact that you may then miss out on getting paid a salary (and your related state pension contributions etc.).

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• Reduces personal liability risks

Another key benefit of owning property in a company, and even more so if it's a SPV, is that it can minimise your personal financial risks as it's a separate legal entity.

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• Investors loans

Directors can loan the company money, which can be used towards the deposit for a buy to let mortgage. Or you could pay that amount from a parent company as an inter-company loan.

And once you draw back that loan, it's usually tax-free.

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• Claim expenses

When you own a property in your personal name, you can't claim certain expenses to offset the amount of tax you owe, but if you own a property in a limited company or SPV, then you can deduct the finance or mortgage related costs from your rental income of your buy to let.

In addition to being able to claim tax relief in this way, you may also be able to claim things like insurance fees and repair costs. This helps to minimise the total amount of tax owing.

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• Buy a property as a collective

Ltd company mortgages offer you a way of buying a property together with several other people (including relatives). And at the same time you can take advantage of limited legal liability that arises from owning property in a company.

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The disadvantages of buying a buy to let property through a limited company

While the benefits of owning a buy to let property in a limited company are numerous, it's important to be aware of the risks and drawbacks listed below:

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• Higher mortgage interest rates

Mortgage interest rates are generally higher for SPVs and limited companies than if you were to take out a personal mortgage for a buy to let.

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• Limited number of lenders to choose from

As the eligibility criteria is stricter for buy to let mortgages (and more so for buy to let corporate mortgages), that means there are fewer lenders and mortgage deals to choose from.

That often means you'll end up paying higher interest rates and more mortgage fee costs.

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• Higher fees and more complex administration

You may end up paying more on legal costs and administration when it comes to company buy to let mortgages (which are a bit more complex than personal mortgages) and managing your limited company.

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• Personal guarantee may be required

Lenders sometimes require personal guarantees from the directors of SPVs when taking out a BTL mortgage.

That means that directors may then be personally liable to cover the bond repayments, even if the SPV or limited company is bankrupt or dissolved.

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• No CGT allowance when you sell

When you sell a property that's owned by a SPV, there isn't the same capital gains tax (CGT) allowance that you get if you sell in your personal capacity.

That means you may end up paying more tax on your profits when you sell, than you would if you owned it in your personal capacity. But that all depends on a range of personal factors.

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• Dividend taxes

If you pay all the profits from renting out a property owned by a SPV or limited company to the shareholders, then you might need to pay dividend tax on those amounts. Those dividend tax rates are paid on a sliding scale and can be quite high.

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• Accounting and legal compliance

There are also a range of accounting and legal compliance requirements that can be onerous for limited companies.

This includes needing to file annual company tax returns, registering for PAYE if the company pays any salaries, and registering for VAT (if applicable).

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• Stamp duty

You'll also need to pay Stamp Duty Land Tax (SDLT) when you purchase a property through a company. And what's more - you'll need to pay the additional 3% second home surcharge on properties valued over £40,000.

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• Lack of legal protection for your mortgage

Most limited company buy to let mortgages aren't regulated by the Financial Conduct Authority (FCA). That means that you won't get the same protection that you would if you took out a residential mortgage.

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How to get a limited company buy to let mortgage: 8 steps

Here are some easy steps to follow when it comes to getting a buy to let mortgage for a limited company.

1. Find the perfect buy to let property

The first step may sound simple. But there's an art when it comes to sourcing a suitable and profitable buy to let property in the UK.

This can also be a time-consuming exercise, particularly if you're using lots of different tools and manually searching for the best buy to let opportunities across the UK.

Pivro's property sourcing software can simplify this process, while providing a powerful array of data to make an informed decision about properties expected to have the best return on investment (ROI).

Pivro helps you source the best buy to let properties, whatever your strategy - in an instant.

Because Pivro's property database platform aggregates real-time data from a variety of sources, you can access all available property data on one easy-to-use platform.

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2. Figure out how much deposit you have and your budget

It's important to assess whether you have the required minimum deposit, for buy to let properties that's typically higher than for residential mortgages.

And it's imperative that you draw up a budget to calculate your expected income and expenses related to your buy to let investment. This can help you figure out whether you've found a viable investment opportunity or not.

3. Research mortgage options and assess your eligibility

Next, you should research the various buy to let mortgage lenders and deals for limited companies.

Once you've identified several, you'll need to assess whether you qualify in terms of their eligibility criteria and specific exclusions.

4. Find a mortgage deal and lender

Once you've identified several options for limited company mortgages, you should start thinking about whether you'd prefer a fixed or variable mortgage and what mortgage term would suit you best.

5. ‍Get professional advice: specialist mortgage advisors and brokers

It's important to get professional advice from a qualified and registered mortgage broker or advisor. Getting a mortgage is a big decision with serious financial implications after all.

It's a good idea to get advice from the time you start looking for a mortgage. Advisors can help you identify mortgage options based on your personal financial history, personal circumstances and needs.

6. Compare buy to let mortgage offers

Once you've narrowed down some mortgage options, you'll want to compare the deals that you've identified.

There are various online mortgage comparison tools that can be helpful in this regard. That, along with advice from your broker.

When comparing mortgage deals, it's important to look at all the costs and terms - not only the interest rates.

7. Make a decision - based on total costs and your personal circumstances

Once you've compared the deals accurately and assessed which offer best suits your needs, you're ready to apply for a mortgage.

Make sure that this decision is carefully considered and based on all relevant (and total) mortgage costs and that it's suited to your personal circumstances and requirements.

8. Application

When you apply for a loan, some brokers will help you with this process and will also follow up with lenders on your behalf.

Once your mortgage contract is concluded, you can purchase the property and start the process of finding tenants and letting it out.

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Best buy to let limited company mortgages

If you're considering a mortgage for a buy to let property, then you'll probably want to know where to start looking.

Not all banks offer buy to let mortgages, and not all banks or building societies will provide finance for certain types of properties or for limited companies.

For example, many lenders specifically exclude loans for houses of multiple occupation (HMOs), properties of certain construction types (like houses with thatched roofs), and many also exclude first time buyers.

In those cases, you may want to consider specialist lenders who specifically cater to your exact needs and circumstances.

Here are a couple of possible lenders for you to consider when you're looking for a buy to let mortgage for a limited company:

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• Banks

Most of the large banks in the UK offer buy to let mortgages, although not all will have deals for limited company buy to let mortgages. And typically the rates for companies will be higher than what's on offer to an individual.

For example, Barclays buy to let mortgage for business offers fixed and variable loans.

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• Building societies

As with large banks, many building societies have their own eligibility criteria for buy to let mortgages, and some exclude limited company mortgages.

Examples of some of the largest UK building societies include Nationwide Building Society, Coventry Building Society, and Yorkshire Building Society.

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• Specialist lenders

If you're looking for a mortgage for your buy to let, and you don't meet the eligibility criteria of banks and building societies - then you may want to look at specialist mortgage lenders.

Specialist lenders are also more likely than high street lenders to accept limited companies that own larger portfolios of buy to let properties.

Your mortgage broker should be able to advise you on the best options to suit your particular needs.

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Frequently asked questions about company buy to let mortgages

If you're looking for a company buy to let mortgage, then here are some answers to frequently asked questions that may be helpful.

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Am I eligible for a buy to let mortgage?

It's good to be aware that buy to let mortgages have different eligibility criteria compared with residential mortgages.

And if you're looking for a company buy to let mortgage, then there may be some extra requirements like needing to sign a personal surety agreement.

In general, the eligibility criteria for buy to let mortgages include being:

• Over 18 years;
• Having a minimum income of at least £25K a year;
• Already owning a property (i.e. not a first time buyer);
• Having an expected rental yield of 125% that of your monthly mortgage repayments.

In addition, when buying a buy to let through a limited company, you may need to show that your limited company is UK registered and that the Standard Industry Classification (SIC) codes relate to property investment or development.

Also be aware of specific exclusions when it comes to buy to lets. Many lenders won't provide finance for housing association real estate and Local Authority lets. And many also exclude lending for HMOs, holiday lets and certain types of construction.

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How to choose the right commercial buy to let mortgage for a limited company

In addition to buying a residential property to rent to tenants, you may be looking to invest in a commercial premises as a buy to let.

When deciding which commercial buy to let mortgage for your limited company is right for your needs, there are a few things to consider. After all, getting a buy to let mortgage for a limited company can be a complex process.

Firstly, think about what type of interest rate will suit you best - a fixed interest rate or a variable interest rate. For buy to let mortgages, fixed interest rate mortgages are more commonplace, and they're typically for terms of between two and five years. Another option is an interest-only mortgage, which is quite typical for buy to lets.

Also consider how much deposit you can put down. In general, the bigger the deposit, the more favourable your deal rates may be.

And, if you opt for a longer term you can spread out the repayments over a longer period, which means your monthly repayments are usually lower than a shorter term deal.

It's a good idea to consider all of these costs and options before comparing limited company buy to let mortgage rates. Having a holistic view of options and full costs can help you compare deals more accurately.

A specialist mortgage broker can also provide invaluable advice in helping you source and decide on the most appropriate BTL mortgage for your limited company.

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What are the risks of purchasing a buy to let property?

No investment is without risk. And the same applies to buy to let properties.

Here are some of the risks to consider before you purchase a buy to let:

• Undesirable tenants: Landlords always run the risk of getting tenants who don't look after a property well, don't pay at all or on time, and who create a nuisance or destroy property. This can create financial and legal implications of a serious nature.
• Property market crash: If you were hoping to make money by selling your property in time (or by flipping it), and there's a property market crash, you could lose out on the expected appreciation value. In the worst case scenario, you could even make a loss.
• Poor ROI and investment choice: Some people make unfortunate purchases that end up not making the return on investment (ROI) that they'd hoped for. This can be the result of a range of factors - one of which is buying a property without having done enough local market research to ensure it's a profitable investment.
• Gaps in tenancy: As a landlord you'll have monthly overhead costs and presumably mortgage interest repayments to make. If you have gaps in tenancy, that can affect your cash flow and ability to meet your financial obligations. That can have devastating effects if you don't have a contingency plan in place, or if the gaps are large or frequent.
• Lower rental yield than expected: If you aren't able to charge the rent that you'd expected, then you may not be able to cover all of your monthly costs associated with managing your buy to let. That includes your mortgage repayments, which can put your property ownership at risk.
• Rising interest rates: If your mortgage is tied to interest rate fluctuations (with a variable interest rate), then if interest rates rise sharply you may be liable to pay more than you'd budgeted for.
• Lower demand for rentals: If demand for rentals suddenly dries up, you could find yourself in the unenviable position of not having a tenant to fill your rental. And when demand wanes, you may also find that rental prices drop.
• Climate risks: The impacts of climate change include more severe weather events and storms, floods and droughts. This can put properties at risk, particularly if they are in low-lying coastal areas. Property damage can be expensive to fix, and as climate impacts increase, so too may insurance premiums. ‍

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• Environmental risks: There are many environmental risks when buying property. That's why it's vital to have all the necessary checks done before you buy, so you know what you're getting yourself into. For example, the land may be susceptible to slippage, subsidence or flooding. There could be noxious plants like Japanese Knotweed on the property that could affect the structure of the property and may cause a nuisance that you could be liable for. Innovative tech tools like Pivro are designed to help provide detailed property information about environmental risks, to help prospective buyers be aware of this type of information.
• Rising landlord costs: There are a range of costs associated with being a landlord. That includes maintenance costs, accounting fees, legal fees, insurance and agency fees. If these fees rise more than you anticipated, that could also affect your cash flow and budget. ‍

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Final thoughts on getting a limited company buy to let mortgage

Buying investment property to rent out to tenants requires lots of careful consideration. From identifying the best buy to let areas and properties, to finding a suitable buy to let mortgage.

Getting a buy to let mortgage for a limited company can be a daunting and complicated process. We hope this article helps provide some useful insights and tips.

It's worth considering the benefits and drawbacks of buying a buy to let investment through a limited company in the UK. While it may not suit everyone, it's an attractive option particularly for portfolio landlords.

Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

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DISCLAIMER: Please do not consider this tax, financial, mortgage or legal advice. We’re simply sharing general information, and we highly recommend you speak to a registered and qualified professional about your individual circumstances before making any decision based on the information provided on this website.

If you’ve found a property to buy and you need finance to make that purchase, then you’re probably wondering how to find the best buy to let mortgage and mortgage provider.

The first step in finding a buy-to-let mortgage is to check your eligibility. If you qualify, you’ll want to look at a range of lenders and see what buy to let mortgage deals they offer. It's important to recognise that this type of mortgage loan is different from a residential mortgage.

Next, it’s important to accurately compare deals and figure out which ones may be best given your particular needs and circumstances. A professional and registered mortgage broker may be able to give you invaluable advice in this regard. It’s important that you carefully assess the pros and cons of a buy to let (BTL) mortgage, and take cognisance of all the fees and costs involved in buying a buy-to-let property.

Our complete guide to buy-to-let mortgages below gives you a comprehensive overview of all of these factors and considerations.

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The growth in buy-to-let investments in the UK: a case for buy-to-let mortgages

Buy to let property investment is increasingly popular in the UK, as there is an abundance and growing number of tenants. According to Statistica, a significant proportion of the UK population rent instead of owning their homes. This represents around a third of all UK households, who are either private or social renters.

UK housing prices have been growing steadily, providing an opportunity to make a good return on investment for buy-to-let property investors. The growth in the buy-to-let market in the UK means more people may be interested in financing that investment with a buy-to-let mortgage.

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What is a buy-to-let property?

A buy-to-let investment property is one that is bought with the intention of letting it out, or renting it to tenants. Buy-to-let properties can be bought by individuals or by companies, and are often seen as investment opportunities.

While most buy-to-lets are residential houses or flats, they can encompass houses in multiple occupation (HMOs), student accommodation or other types of properties for renting.

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What is a buy-to-let mortgage? Unless you have the cash to pay for your buy to let investment in full, you will need to borrow some of the money you need in the form of a buy-to-let mortgage.

A buy-to-let loan or mortgage is a legal contract where you, the purchaser, agree to borrow money from a lender - and agree on how you will repay that loan amount.

To meet your monthly payments, you'll need to show your property will yield sufficient rental income to cover the repayment mortgage amount. That's in part how a buy to let mortgage loan is different from residential mortgages.

There are different types of mortgage lenders (which we look at below). Lenders typically require you to pay either a variable or fixed rate of interest on the loan amount, but there are other types of mortgage arrangements too.

There are eligibility criteria that you’ll need to meet, as a first step in getting a buy-to-let loan or mortgage. Part of this qualification process will establish how much of a deposit will be required (which you’ll need to put down) and how much you’ll be able to borrow.

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Where can I find the best buy-to-let mortgage in the UK?

If you are keen to get a buy-to-let mortgage in the UK, it can be a daunting task figuring out where to start looking. Comparing options can be challenging if you don’t know what you’re looking for or how to compare accurately.

There are also some nuanced differences between the types of mortgages that you may be eligible for and that’s why many people choose to get professional advice from a licensed mortgage advisor.

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To get started with your research into finding the best buy-to let loan or mortgage, we’ve summarised some options for you to consider:

1. Buy-to-let mortgages from banks

The majority of large banks in the UK offer buy-to-let mortgages.

Most of these banks provide information on their websites about the types of buy-to-let mortgage options they offer. Many have a useful buy-to-let mortgage calculator on their sites which you can use to get an idea of how much you’d be eligible to borrow, and to assess your general eligibility.

Generally, the better your credit rating and bigger your deposit, the more favourable the lending rates will be.

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Some examples of UK banks that offer buy-to-let mortgages include:

• Barclays Bank’s buy-to-let mortgages

Currently Barclays buy to let mortgage deals are available if you’re at least 21 years old and wanting to borrow under £2 million. As the sole applicant, you'll need to earn more than £25,000 a year if you plan to borrow up to £1 million. That annual salary amount increases to £75,000 a year if you want to borrow more than £1 million.

They offer a range of tracker and fixed rate BTL mortgages, with exclusive rates for existing bank mortgage holders. In addition they offer premier landlord mortgage and professional landlord mortgage rates.

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• TSB’s buy-to-let mortgages

Currently, the TSB buy to let deals are available for people over 25 years of age who earn a minimum of £25,000 per annum.

You can borrow from between £25,005 up to £1 million and take out up to three of their BTL mortgages, totalling £2 million altogether. They offer a 2year fixed rate deal, a 2-year tracker deal and a 5-year fixed rate deal.

Importantly, TSB’s BTL mortgages are not available to first time buyers.

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• HSBC’s buy-to-let mortgages

Currently HSBC’s buy to let deals include a range of fixed and tracker mortgages for UK residents who earn at least £25,000 a year.

To be eligible, you need to have owned and lived in your house for at least 6 months. In other words, if you’re a first time buyer, you won’t qualify for one of their BTL mortgages.

In addition, you can’t be a portfolio landlord (i.e. you can’t have 4 or more BTL mortgaged properties). And the mortgage can’t be for a HMO, such as a shared student house.

If however, you’re looking for a BTL mortgage as a non-UK resident, they do have some separate rate offerings.

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• NatWest’s buy-to-let mortgages

If you’re looking for a NatWest buy to let deal, then you’ll need to be a UK resident and older than 18 years (but not older than 80).

You’ll be required to put down at least a 25% deposit (more for new builds). And the rental income you plan to get must be at least 125% of your monthly interest payments.

Furthermore, at minimum you’ll need to borrow £25,000 over a minimum of 3 years.

As with HSBC’s buy to let mortgage, you won’t qualify if the mortgage is for a property that will be rented out as a HMO. That extends to bedsits, rentals to related persons and properties that will be used as holiday lets.

NatWest offers both capital and interest and interest-only BTL mortgages.

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‍2. Getting a Buy-to-let mortgage from a building society In addition to banks, there are a wide range of UK building societies that offer buy to let mortgages.

Building societies are cooperative financial institutions owned by their members, with very similar service offerings to banks.

Examples of UK building societies include:

• Nationwide Building Society;
• Coventry Building Society;
• Yorkshire Building Society; and
• Skipton Building Society. ‍

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3. Specialist buy-to-let mortgage lenders In addition to banks and building societies, there are a range of specialist buy to let loan or mortgage lenders in the UK. Some specialise in houses of multiple occupancy (HMO) buy-to-let mortgages, others in limited company BTL deals, or in holiday let BTL mortgages.

Many of these specialist brokers will not be tied to specific lenders and their deals, providing access to a wide range of mortgage opportunities.

As with any lender and mortgage advisor, make sure that you chat with qualified, experienced and registered professionals.

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How to choose between different buy-to-let mortgage options?

Once you’ve had a look at the different BTL mortgages that are available, you’ll want to make a decision about which one is best for you.

Choosing between different buy to let mortgages can be a tricky and confusing process. To help make the decision, you can do your own research, discuss your options and get advice from a registered mortgage broker, and use a range of online buy-to-let comparison tools.

While you may be tempted to only look at the rates or terms associated with different options, there are other important factors worth considering. That’s where professional advice can be invaluable.

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Do your own research

It’s important to do thorough research when finding a buy to let loan or mortgage. After all, you want to ensure that you choose a reputable lender and the most suitable options given your specific circumstances and needs.

The implications of choosing an unsuitable mortgage or disreputable lender can be significant and long-term.

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Mortgage broker/advisor

Many people turn to a mortgage advisor who can provide insights and advice about buy to let mortgage options, lenders and the most suitable options given your needs and circumstances.

Make sure that your mortgage broker or advisor is registered with the Financial Conduct Authority (FCA) on their financial services register.

Check whether they provide whole-of-market advice or whether they only work with a limited range of mortgage lenders and their associated deals.

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Use a buy-to-let comparison tool

Making use of online buy-to-let mortgage comparison tools is another way to help you choose between the various options available.

It’s a good idea to use several of these comparison tools, as they may yield different results. And make sure that you are comparing the same type of mortgage.

Here are some examples of online buy to let comparison tools:

• Which?
• Moneyfacts
• MoneySavingExpert
• MoneySuperMarket
• Uswitch ‍

Other things to consider when choosing between buy-to-let mortgage options

In addition to looking at the different types of BTL mortgages that are on offer and their rates, it’s a good idea to consider some other factors too.

For example, check whether there are any early repayment fees, or if you are able to make overpayments. Look at the overall fees involved in the mortgage - as these can sometimes outweigh the advantages of a lower repayment rate. Fees may be charged as a set fee, or as a percentage of the loan.

The duration of the loan offered and the deposit amount will both be important factors when comparing mortgage deals.

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How much of a mortgage can I get if I’m purchasing a buy-to-rent property?

This is of course a very popular question when it comes to buying to let properties. The answer is somewhat complex, as it depends on a range of factors which will be different for everyone.

There are a variety of factors that lenders will consider when deciding how much you can borrow. That includes the value of the property you’re planning to buy, the expected rental yield, your income and personal circumstances.

A good starting point to figure out how much of a mortgage you might get, is to estimate the rent you’re likely to receive. To do this, you can start by finding out what the average rentals in the area are for the house that you want to buy. Local estate agents can be helpful in giving you this information.

Pivro’s property market analysis platform can assist in this regard, by providing real-time, area-specific data about average rentals in any area of the UK.

After you’ve worked out what rental you might get, you’ll need to calculate your expected rental yield (after all the costs have been deducted). There are some helpful buy-to-let rental yield calculators online that can help you create a rough estimate.

Your rental income will usually need to be at least 125% of your monthly mortgage repayment amount, to be eligible for a buy to let loan or mortgage.

You can get borrowing estimates on most bank’s websites. And you can also ask your mortgage broker to help you calculate how much of a loan you might be eligible for.

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How much of a deposit will I need to put down for a buy-to-let?

Each lender will have different requirements in terms of the minimum deposit required. As a general guide, it’s usually between 20 to 25% of the value of the property you intend to buy.

That being said, some lenders may allow as little as a 15% deposit, and some may require up to around 40%.

It’s important to remember that the higher the deposit you are able to put down, the more favourable your mortgage rate will be (generally).

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What buy-to-let mortgage fees can I expect to pay?

There are a range of different fees that you may be expected to pay as part of taking out a buy to let loan or mortgage. These are additional to the amount you’ll be paying back to the lender each month in terms of your mortgage agreement.

It’s important to consider these before you take out a mortgage, as they can be costly and can affect your ability to meet your financial obligations.

Here are some of the fees related to a buy-to-let mortgage:

• Mortgage advisor fees
• Deeds release fee
• Lender arrangement fee
• Booking fees
• Valuation fees for your property
• Conveyancing fees
• Legal fees
• Early repayment fees
• Mortgage exit/closure fees ‍

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Am I eligible for a buy to let mortgage?

Unfortunately not everyone is eligible for a buy to let mortgage. And different lenders will have different eligibility criteria.

It’s therefore important to look at each lender’s eligibility criteria individually. And if you don’t make the cut - consider looking at a different lender.

In general, to be eligible for a buy-to-let mortgage, you’ll need to:

• earn at least £25,000 a year;
• be between 18 and about 70 years;
• have a good credit score;
• sometimes you may be required to own your own home (with many first time buyers being excluded from BTL mortgages);
• show that your expected rental income will be more than your mortgage repayments (typically at least 125%); and
• have at least 25% of the property value to put down as a deposit.

It’s important to look at exclusions. These are generally related to what the purpose of the property is, such as a holiday home or HMO. Many lenders (particularly banks and building societies) won’t be prepared to offer a buy to let mortgage for holiday lets, HMOs or properties that will be rented to family.

Some lenders will not provide BTL mortgages for unusual construction types such as thatched roofs.

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Can I get a buy to let mortgage for a limited company?

While this article is focused on getting a buy to let mortgage as a private individual, you can get a buy-to-let mortgage for a limited company.

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Understanding the different types of buy-to-let mortgages

Before deciding on a buy to let mortgage, you should have a good understanding of the different types of buy-to-let mortgages.

Knowing how they are different, their financial implications and the pros and cons of each type of mortgage, can help you make a more informed decision about which type is best for you.

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These are the 3 main types of buy-to-let mortgages in the UK:

1. Fixed rate mortgages

A fixed rate mortgage is one that guarantees that your monthly mortgage payments will stay the same over a specified period. These types of mortgages are typically for either 2, 3 or 5 years - although you may find other lengths of time available.

The vast majority of mortgages offered are ones with fixed rates. In general, the longer the fixed period mortgage you opt for, the more interest you’ll end up paying.

With this type of mortgage it’s important that you consider what upfront fees you’ll be paying (such as the arrangement fee), and whether you’ll be allowed to make overpayments. You may be liable for early repayment charges (ERCs), which are typically charged as a percentage of the outstanding mortgage amount.

When there’s uncertainty in the economy created by fluctuating interest rates, these fixed rate mortgages can be particularly attractive. 2. Variable rate mortgages

A variable rate mortgage is one that fluctuates as there are changes in interest rates.

There are three types of variable rate mortgages: standard variable mortgages, tracker mortgages and discount variable mortgages.

The 3 types of variable rate mortgages:

• Standard variable mortgages

Standard variable mortgages have their rate set by the lender, which can change at any given time.

• Tracker mortgages

Tracker mortgages have their rate set in line with the Bank of England’s base rate. If interest rates go up or down, your monthly mortgage repayments will fluctuate in line with those base rate changes.

Bear in mind there may be some ‘collar’ minimum repayment rates included in tracker deals, which means that even if interest rates drop, your repayments may not drop below a certain threshold.

Sometimes (although quite rarely) there are tracker mortgages with ‘caps’ that set maximum interest rates.

• Discount variable mortgages

Discount variable mortgages provide discounts on a lender’s variable rate for a specified amount of time. The interest rate for these mortgages are usually set below the lender’s standard variable rate (SVR) for the term of the mortgage, or a defined period.

This type of variable mortgage allows the lender to increase or decrease the rate at any time. When interest rates are low, this type of mortgage can often be quite affordable. But these mortgages can include a ‘collar’ minimum repayment amount; and most have no ‘cap’ and therefore no maximum rate limits. 3. Buy-to-let remortgages Essentially a buy to let remortgage is a deal whereby you change your property mortgage to a new one.

That could involve switching to a new lender, or staying with your current lender and changing your mortgage deal.

There are various reasons why property owners choose to remortgage their BTLs. One such reason is to free up some cash. Another is to change mortgages because of more attractive deals being available.

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The pros and cons of a buy to let mortgage

While you may be so enticed by a particular investment property that you dive straight into buying it, it’s prudent to first consider the pros and cons of a buy to let mortgage.

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Pros of a buy-to-let mortgage

• If you don’t have enough money to buy a property, then taking a buy to let mortgage and paying it off with your rental yield may enable you to purchase it;
• The rental housing market is growing, which means you should be able to find a suitable tenant;
• Rental prices usually increase with inflation;
• Investing in a property can, over time, provide a source of financial growth if the housing market and property rates grow;
• If you can’t afford to buy a property and pay off a mortgage, renting it out to tenants who cover the mortgage repayments and more, can give you access to some additional income;
• You may be able to claim some expenses related to managing your BTL property against the tax you owe;
• You may be able to make some additions or home improvements which increase your rental yield and the overall property value over time. ‍

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Cons of a buy-to-let mortgage

• Borrowing requirements for a BTL mortgage may be more strict than a regular home mortgage, which may make you ineligible;
• Generally, you’ll need to have at least 25% of the property’s value as a deposit to put down;
• By putting down a deposit and owing mortgage repayments, your money may be tied up for a long period of time;
• You may struggle to find a suitable tenant and you may not manage to get the rental income you expected;
• If you’re counting on your investment property rising in value over time, and there are property market drops - you may not make the profits you were expecting to (or could even lose value);
• You may have to pay for an expensive repair, maintenance work or upgrades to comply with changing legislation;
• If your plan is to sell the property at the end of the mortgage to make your capital repayment amount (particularly if you’ve taken out an interest-only mortgage), and the property market crashes - you could find yourself in a precarious situation of not having enough to pay off the loan;
• You may encounter gaps in tenancy, or tenants who don’t pay on time (or at all), which can affect your ability to meet your monthly loan repayments;
• When you add the costs of managing a property (such as insurance, maintenance, stamp duty etc.) to the costs of your mortgage, you may need to pay in from your personal income to meet the monthly repayment amounts;
• It can be a time-consuming and tricky business managing tenants and ensuring all the paperwork and legal requirements are met if you plan to do it yourself;
• When you sell your BTL property, you may be liable for capital gains tax if you make a profit. ‍

How to find a suitable buy-to-let investment property?

Before you arrange a BTL mortgage, you presumably would have spent time finding the best buy to let area and an attractive investment property to buy.

If you’re just starting out looking for a suitable buy-to-let investment property, then Pivro offers a powerful tool for helping you find the perfect property investment.

By harnessing the power of Big Data, AI, and VR, Pivro’s property marketing automation and property investment analysis platform can help you identify the best property deals from across the United Kingdom.

Providing instant access to real-time, integrated property data including area statistics and BTL investment yield calculations, Pivro provides an exclusive membership platform to search property investment data, uncover trending property insights, and make use of powerful data analysis tools.

This can help you save time and money as you search for your ideal UK investment property.

Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

If you're considering expanding your UK property portfolio or investing in residential property or other rental properties, you're probably keen to know more about how to finance your investment.

One of the most common ways of financing a property that you plan to rent out, is by getting a buy-to-let mortgage. But figuring out how a buy to let mortgage works, and how it's different from a residential mortgage can be complex and time consuming. And there are a host of things to watch out for when getting a buy to let mortgage in the UK.

We've summarised some of the most important factors to consider when getting a buy to let mortgage. And we've included some helpful tips to make the process of getting a buy to let mortgage easier to navigate.

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What to look out for when choosing a UK buy-to-let mortgage?

Below we look at some top tips on what to watch out for when choosing a buy to let mortgage.

Buy to let mortgages are different from residential mortgages in many ways. For example, their eligibility criteria are often stricter, and they typically require a larger deposit. Many buy to let mortgages are interest only and many lenders have specific exclusions (such as houses of multiple occupancy).

It's critical that you fully understand the rental property market and what will be expected of you in terms of your mortgage payments (and other fees). And you should be aware of how to accurately estimate your monthly rental income, as that affects your ability to meet your mortgage obligations and it affects how much you'll be able to borrow when applying for a loan.

It's also important to know which tools are available to help you make an informed decision when it comes to finding the perfect buy to let mortgage and finding the best buy to let property.

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Check whether you meet the eligibility criteria for a BTL mortgage

One of the first things to consider when you’re looking for a buy to let loan, is whether you meet each lender’s minimum eligibility criteria.

Otherwise you could be wasting your time looking at attractive mortgages that you don’t qualify for.

Most of the large banks and building societies in the United Kingdom will require you:

• are at least 18 years;
• have a minimum income of £25,000 a year;
• and have a good credit rating.

Often first time property buyers aren't eligible for buy to let mortgages. But there are specialist lenders who may be willing to provide finance to first time buyers.

One important factor to bear in mind is that you'll usually need to show that your expected rental income will be at least 125% or more than your mortgage repayments. That also helps to ensure that you will be able to meet your monthly payments.

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Useful Tips:

• In addition to looking at eligibility criteria for buy to let mortgages, also look at the mortgage provider and their specific exclusions. This will also help you see whether your specific circumstances exclude you from certain mortgage deal offers.
• For example, some lenders specifically exclude non-UK citizens. Other mortgage providers exclude certain types of building construction like houses built with thatched roofs.
• Many buy to let mortgage providers also specifically exclude properties that will be rented as houses of multiple occupation (HMOs), or homes that will be rented to a close family member.
• Consider getting advice from a registered mortgage advisor at this stage, who can help you save time selecting buy-to-let mortgages that you would qualify for. If you choose a broker who offers 'whole of market' advice, then you’ll have access to a wide range of options (rather than a broker who only works with a limited number of lenders). ‍

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Be accurate when comparing the best buy-to-let deals

Once you've narrowed down the list of buy to let mortgage providers and deals that you’re eligible for, you can move on to comparing these mortgages.

While you can also manually compare different deals, that can take a lot of time and effort.

To help you make accurate comparisons more quickly, there are a range of online buy-to-let mortgage comparison tools that can be helpful. They can help you narrow down the list of potential lenders and the deals that suit your personal circumstances. These buy to let comparison tools include Uswitch, MoneyFacts, MoneySuperMarket and Money.

Mortgage advisors can also help you compare deals, lenders, and mortgage options.

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Useful Tips

1. Make sure you use a range of mortgage comparison tools and don’t just rely on one, as they can provide slightly different results.
2. Make sure you get advice from a reputable and registered mortgage advisor.
3. When comparing mortgage deals, compare mortgage rates, mortgage terms, associated fees, down payments and the deposit required. Also look at whether you’re eligible for overpayments (or if you'll face any penalties for making early payments) and compare the overall cost of each deal (not only the rates). ‍

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Select a reputable buy-to-let lender

There are a range of different lenders that offer BTL mortgages in the UK. These include many of the big banks, building societies and specialist mortgage lenders. There are also some innovative peer-to-peer lending and fintech options becoming available.

Whichever lender you decide on, make sure that they have a good reputation and that they are registered with the Financial Conduct Authority (FCA). It’s also worth checking how satisfied other customers have been with different lenders. There are many online customer satisfaction surveys of large mortgage lenders that can provide useful insights in this regard.

And, you may want to look at the lender’s track record when it comes to mortgage complaints lodged with the Financial Ombudsman Service. Your mortgage broker should be able to give you advice about the best lenders, so that you can ensure that your investment and deposit are safe.

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Useful Tips:

You can check with the FCA whether your chosen lending firm is registered with them (and therefore regulated by the Financial Conduct Authority). ‍

Check that your mortgage broker is qualified and registered

There are a range of benefits to using a mortgage advisor or broker. If you’re wondering how to choose a good mortgage broker in the UK, then the first step should be to check that they’re qualified and registered.

In the UK, mortgage brokers should have a Certificate in Mortgage Advice and Practice (CeMAP) or Chartered Insurance Institute Certificate in Mortgage Advice (Cert MA) that’s approved by the Financial Conduct Authority (FCA).

Mortgage brokers also need to be registered with, and authorised by, the UK Financial Services Authority to provide mortgage advisory services, which you can check on the financial services register.

You can also use online customer service reviews to get a sense of how happy others have been with the broker you have in mind to use.

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Useful Tips:

• Ask your broker if they are “whole of market” which means that they can access all mortgage deals from a wide range of lenders. That’s because some advisors are tied to one or two specific lenders only, so you’ll only get access to a limited number of deals.
• Ask your advisor what brokerage fees they charge, and if those fees are a flat rate, a percentage rate, or commission-based. Many mortgage advisors don’t charge fees as they are paid commission directly by lenders.
• Ask your mortgage advisor what services they offer and if they handle the administrative tasks involved in your mortgage application like following up with lenders. ‍

Check what mortgage deposit is required (it's usually more than with residential mortgages)

It's good to be aware of the fact that deposits for buy to let properties are usually higher than for residential mortgages. Most UK BTL lenders will therefore require you to put down a minimum deposit of about 25% of the property’s value.

When searching for BTL mortgages, it’s tempting to just look at the lender’s interest rates. But it’s important to consider the whole range of costs and implications of the mortgage you’re considering. And that includes how much deposit will be required, whether it's a fixed rate or a variable rate, what the term (or duration of the mortgage is), and any additional fees.

Consider carefully whether the deposit amount is affordable for you. In general, the bigger the deposit you’re able to put down, the more favourable the mortgage rates you may be offered.

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useful Tips

• Consider the source of funds for your deposit. Most lenders want this to be from income saved. If you're planning to rely on funds that are gifts, or from other sources like cryptocurrency, then it’s best to check with your lender whether this will be acceptable.
• Use an online mortgage calculator tool to help you estimate what mortgage you're eligible for and how much deposit will be required. ‍

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Check if the type of property you want to buy is eligible for a buy-to-let mortgage

As mentioned above, many mortgage providers have specific exclusions when it comes to buy to let home loans.

There are certain types of properties that you may struggle to find a buy to let mortgage for. That frequently includes houses of multiple occupation (HMOs), properties that are intended to be holiday rentals, and properties with specific types of construction like thatch roofs.

If you’re looking for a specialist BTL mortgage, then you may want to look at specialist buy to let mortgage lenders. They may be more willing to offer loans for properties that typically get excluded from mortgages.

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useful Tips

• Check each lender's list of specific exclusions when it comes to their buy-to-let mortgages.
• Consider up front who you will be renting your property to, and whether that is a commonly excluded property use by lenders. ‍

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Accurately calculate your expected rental yield (and rental income)

Another critical factor to consider when you’re getting a buy to let mortgage is whether you've accurately calculated your expected rental yield.

That’s because lenders will need this information to decide on how much they’re willing to provide as a mortgage. If you’re a basic-rate taxpayer, lenders usually require that rent has to be 125% of the interest that you owe on your outstanding mortgage.

Calculating your rental yield is also important for cash flow. That's because if you've overestimated this amount, you may not be able to afford your mortgage payments and could run into debt.

Calculating your rental yield means you also need to work out all the costs associated with owning a property. These costs need to be deducted from your rental income.

When you’re trying to figure out how to accurately calculate your expected rental yield, there are some useful tools and resources that can be helpful. That includes online rental yield calculator tools.

It's also prudent to speak to local estate agents in the area where you’re buying the property to see what other similar properties monthly rentals are. That can give you a rough idea of how much rental income to expect - and also whether the property value has been correctly estimated.

Another useful tool that you can use to find real-time data about property rentals in any area of the UK, is Pivro’s property investment analysis platform that can help you identify the best property deals from across the United Kingdom. It allows users to drill down into property data aggregated from multiple sources, giving you quick, comprehensive, real-time analysis and insights.

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useful Tips:

• You can signup for a free 30-day trial of Pivro’s property investment analysis platform, so you test out its powerful data analysis tools for yourself before committing to a monthly membership fee. ‍

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Check what mortgage fees and other associated costs you will owe

Taking out a mortgage for a rental investment can be a complex and complicated process. That’s because in addition to the mortgage repayment rates, there are also a host of other associated mortgage costs that you need to consider.

These costs can all mount up and become quite expensive, so you need to make sure you’re prepared for them and have included them in your overall budget.

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List of possible fees that are directly related to your mortgage

Here are some of the typical costs related to getting a buy to let mortgage in the UK:

• Mortgage advisor fees
• Deeds release fee
• Lender arrangement fee
• Booking fee
• Property valuation fee
• Conveyancing fees
• Legal fees
• Early repayment fees
• Mortgage exit/closure fees ‍

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List of possible fees related to owning a rental investment property in the UK

And here's a list of other costs associated with owning a buy to let home that you'll need to factor into your budget:

• Stamp duty
• Capital gains tax (if you sell the property and make a profit)
• Maintenance and repairs costs
• Letting agent fees
• Accounting fees
• Buildings insurance
• Compliance fees (e.g. annual gas compliance certificate)
• Landlord insurance ‍

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Understand the implications of your buy to let mortgage deal terms

It’s also vital to understand all the risks and implications of a buy to let mortgage. Knowing what you will be expected to pay, how often, and by when it is critical for your own financial planning purposes.

And knowing the full range of costs you’ll be liable for, will help you make a more informed decision when it comes to buying a buy to let and the type (and term) of buy to let mortgage.

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useful Tips

• Read the fine print! As will all legal contracts, it’s very important to read the full contract before you sign it. If you’re unsure about anything, then ask questions and get proper advice from a qualified and registered advisor.
• Be aware that there are key differences between buy to let mortgages and residential mortgages. And most buy to let mortgages aren’t regulated by the Financial Conduct Authority (FCA). ‍

Other considerations before you purchase a buy to let property (and looking for buy to let mortgages)

Before you embark on buying a rental property, you may want to consider some of the risks involved.

Below are three key considerations to bear in mind, before you start looking for buy to let mortgages.

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Should I set up a limited company before purchasing a buy to let?

Before you buy a BTL property, you may want to consider the benefits of setting up a limited company to make that purchase.

You’ll need to get some expert advice on this, as the figures will be stacked differently for everyone, depending on your particular circumstances.

Some of the benefits associated with buying a property through a limited company include the fact that then all the costs (including mortgage payments) can be deducted as business expenses when calculating how much annual tax you owe. There can also be tax benefits.

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helpful tips:

• Do more research about getting a buy to let mortgage for a limited company ‍

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What's the risk of having undesirable tenants?

Have you thought about who you'll rent your property to?

Depending on the type of property, its location and the demand for rentals in that area, you may struggle to find a tenant. Or you may struggle to find the rental income you were expecting. Or you may get undesirable tenants who cause damage, nuisance, or refuse to pay.

Any of these scenarios can cause administrative, legal and financial costs and implications for you.

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helpful tips:

• Consider speaking to local rental agents about the types of tenants in the area you're looking to invest in. ‍

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How important is local property market knowledge when buying?

If you’re not aware of local property trends, then you might struggle to find tenants. For example, is there weakening demand for rentals in a particular area?, Or how is the ban on letting agent fees affecting rentals in the area? And do you know what types of tenants to expect in your property's area?

When you buy a property to rent out, it’s good to have some local knowledge of the area where the property is located.

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helpful tips:

• Speak to local estate agents to find out about the latest property trends. ‍

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Final thoughts on what to consider before getting a buy-to-let mortgage

A buy to let mortgage is a serious commitment that comes with many risks and obligations. It's imperative to get proper advice, and to do thorough research before choosing a mortgage. After all, you want to be certain you can meet the repayment mortgage amount from your rental income.

Some of the important factors to consider when choosing a buy to let mortgage include the mortgage term, the minimum deposit required, the risks associated with interest rate changes, and your expected monthly mortgage repayments.

It's also important to consider all the costs of owning a buy to let property, such as agency fees and home insurance. Plus the logistics and admin of dealing with tenancy agreements, and doing the annual accounting and tax returns.

And don't forget about the importance of a realistic purchase price, property valuation and an accurate expected or potential rental income calculation.

Contact Pivro

To learn more, contact Pivro and speak with a marketing automation for property professionals expert who can answer any questions you might have.

If you enjoyed this article, please feel free to share it on your favourite social media sites.

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