Interview with Matthew Anderson

The buy-to-let market is booming again but what's the real reason behind the resurgence and how long will it last? Fincorp director Matthew Anderson shares his thoughts.
Buy-to-let is making a comeback, is that solely because would-be buyers can't get on to the property ladder or is it more than that?
It's a number of things. Recently the National Housing Federation has released data confirming that not only are first-time buyers continuing to struggle to buy but even their parents are finding it difficult to help. We're moving towards having a generation of renters. But it's also because there is a greater availability of buy-to-let products and with interest rates still so low the returns on buy-to-let are very attractive. It's a combination of all these things.
Lots of reports are claiming the UK is moving towards having a renting culture like much of Europe. Will this generation get used to renting?
I think they will. Until recently first-time buyers were being helped by the Bank of Mum and Dad but they're finding it difficult now. It's difficult to release enough equity in their homes and the amount of deposit required by lenders means even the Bank of Mum and Dad angle is prohibited, especially if you have three or four children - how can you find enough to help all of them with their deposits? It's a difficult time.
How can bridging help?
A lot of buy-to-let lenders will lend against purchase price regardless of value. Landlords can buy at market value, hold on to it for a while then refinance it. That's where bridging can help.
Is it dangerous to use bridging to purchase a buy-to-let property in this climate?
Professional landlords will have their exit strategy lined up. Not many say "I'll get it refinanced but I don't know where from yet". People are much more aware. It's important to differentiate between professional landlords and those people who just think property is a good idea. Landlords have a track record. It's not just about finance now, you have to prove you know what you're doing. I know that from my own experience as a landlord. You need to show what agents you use, show you're income, show how long you've been doing it. In the past people though it was easy to make money from buy-to-let, they assumed a rental property will always be rented but that's not always the case.
How much of your business is for buy-to-let?
I'd say 10 to 20% enquires, a year ago that was 0%.
When will the buy-to-let boom end?
It will end when mortgage lenders are happy to provide more residential mortgages with smaller deposits. There's never a really strong buy-to-let market at the same time as a really strong residential market. It's one or the other.