An increasing number of brokers are looking into HMO (Houses in Multiple Occupation) mortgage products. This shift indicates that many landlords are now focusing on HMOs, eyeing them as a lucrative investment choice for better returns.
What the Numbers Say
Recent research from Legal & General Ignite reveals that searches for HMO mortgage products soared by 20% in November. This statistic is a clear indicator of the growing interest in this type of property investment. Additionally, there’s a noticeable uptick in the pursuit of mortgages for a ‘second residential property’, with a 29% increase reported.
Market Resilience and Diverse Trends
Kevin Roberts, the Managing Director of Legal & General Mortgage Services, commented on these findings. He noted, “The data… highlights the resilience of the overall mortgage market, with diverse trends among portfolio landlords and a sustained interest in capital raising, even during these uncertain times.”
First-Time Buyers
The property market is also witnessing a significant movement among first-time buyers. Google searches for mortgages allowing a gifted deposit rose by 10%. This trend suggests that more first-time buyers are receiving financial assistance from family or friends to make their property purchase feasible.
In November, there was a 9% month-on-month increase in searches for first-time buyer products. This uptick hints at a renewed eagerness to enter the housing market, despite the difficult economic conditions.
The Role of ‘Bank of Family’ and Affordability Concerns
Roberts added a crucial insight into this trend: “As the property market continues to evolve, it’s clear that first-time buyers are driving significant momentum, seeking support from the Bank of Family to navigate affordability challenges.” However, he also highlighted a continuing issue: “Affordability does remain a persistent concern though, reflected in the notable level of defaults and missed mortgage payments, as well as the continued reliance of first-time buyers on the support of family and friends.”