Around 25% of landlords are prioritising energy efficiency when it comes to adding a property to their investment portfolio — despite the government’s rollback on energy efficiency targets for BTL properties — revealed the latest research from The Mortgage Lender.
According to the report, while energy efficiency is a factor landlords consider when purchasing properties, the biggest priorities for investors are the price of the dwelling (cited by 48% of landlords), expected rental yield (29%), and an attractive location (29%).
Other factors considered by landlords include the property’s long-term investment potential (23%), the council tax banding (17%), the property being move-in ready (16%) and inside layout (16%).
When asked how they will buy their next rental property, 24% of landlord respondents said they’d acquire it as an individual investor with a mortgage, while 22% would buy as an individual with cash.
Meanwhile, 10% would purchase their next property as a limited company with a mortgage.
The research also revealed that mortgages remain a key priority for landlords — 77% said the rate of mortgages available is an important factor for them when buying a property with a mortgage.
Other factors landlords felt to be important included wanting greater fluidity from lenders such as in the amount they could borrow (76%), the discount on fees (72%), flexibility on criteria (72%), and the support offered by the lender (70%).
Chris Kirby, head of sales for Midlands, South and specialist distribution at TML, said: “It’s encouraging to see that BTL landlords are continuing to adapt and shift their priorities, even though the government postponed the planned introduction of energy efficiency standards for properties in the PRS.
“It shows just how committed many landlords are to staying ahead of the curve and anticipating tenant expectations.
“As lenders, we similarly want to offer greater flexibility in order to best support BTL landlords, whether this comes in the form of extending our product range or working with brokers to offer the best options for their customer base.”
