I’m sure that we will see a number of twists, turns and shifts in focus throughout the mortgage market over the next 12 months, with specialist sectors likely to be at the heart of many key trends.

When looking ahead to 2024, a comment which stood out for me was from Chris Baguley, Group Channel Development Director at Together when he said: ‘the winners of 2024 and beyond will be those who can seek out new opportunities, spot where best to create value and use the right financing to capitalise on emerging growth sectors.’

This came on the back of a study which outlined that 34% of buy-to-let landlords are gearing up for further expansion in the next 12 months, shrugging off tough market cautiousness. Indeed, while 10% of all respondents admitted their reservations about their business outlook ahead of 2024, 68% felt optimistic, with a quarter planning to refinance their properties to support their business objectives over the next year.

There is an undeniable opportunity for landlords, investors and developers to take advantage of specialist finance in a time when there is waning financial support for differing project types from mainstream lending channels. A fact which was demonstrated in Together’s study, with 42% of all respondents saying they would prioritise using a specialist rather than mainstream lender in the next 12 months, should they require additional financing for commercial property cases.

In our experience, many of these opportunities have been centred around property professionals taking on refurbishments projects rather than purchasing investment properties which are already completed and ready to go. To help demonstrate the ongoing availability of such opportunities, YOPA recently analysed the price difference between unmodernised properties and similar, comparable properties in the same area that do not need modernisation.

This found that across the 41,951 unmodernised properties currently available in Great Britain, the average asking price currently sits at £313,835. This represents a saving of 6.2%, or £20,632, compared to the average price for modernised equivalents (£334,467).

The biggest savings were said to be on offer in the Yorkshire & Humber region where the average fixer-upper asking price of £200,000 marked a saving of 9.7%, or £21,500, compared to the region’s modernised comparables. In Wales, fixer-uppers came with a discount of 9.5% compared to local modernised comparables, which marked a cash saving of £20,545. In both Scotland and the East Midlands, the discount associated with a fixer-upper came in at 9.3% – a respective cash saving of £18,700 and £23,485.

Fixer-uppers can not only allow landlords and investors to often acquire a property below market value but also allow them to tailor the property to particular specifications to maximise rental yields. However, as can often be the case in scenarios like this, more work may be required than initially thought, timeframes elapse, work overruns and costs can sometimes spiral. All of which can often result in lenders pulling the plug post-offer and borrowers having to turn to short-term finance to bridge the gap until the property is deemed suitable for a future BTL exit.

Such a scenario can often be financially damaging if not swiftly acted upon and this is where the best advisers can really prove their value, especially those who have access to viable solutions whether from a BTL, bridging, semi-commercial, commercial or secured loan standpoint. Be this through their own experience or via a trusted specialist packaging partner who can do all the heavy lifting and meet even the tightest of deadlines. And in a relatively stagnant housing market where an array of property professionals maintain the ability to take advantage of opportunities which continue to present themselves, this is an area which all intermediary firms should be ready, willing and able to support at any given time.  

Our Managing Director Donna Wells was recently quoted in a feature about the second charge market in Mortgage Strategy

Complex needs? Second charge to the rescue – Mortgage Strategy

Donna Wells, Managing Director at Envelop