The Mortgage Works (TMW) has claimed to be the first mainstream buy-to-let lender to allow its borrowers to offer their tenants the option of a longer-term contract.
Usually lenders require buy-to-let borrowers to offer their tenants a maximum contract of 12 months. However, TMW, which is part of the Nationwide Building Society Group, believes that by allowing customers the choice to offer longer term lets – up to three years – it will not only bring greater flexibility to the private rental sector in the UK, but also has the potential to provide more stability to the increasing numbers of people who rent homes privately.
In addition, the Society is set to launch a new online independent Landlords’ Guide and the Nationwide Foundation has launched its new strategy aimed at creating decent, affordable housing for people in need.
Richard Napier, divisional director of mortgages at Nationwide Group, said: “The private rental sector has grown and changed phenomenally over the last few years, with rising numbers of families looking to rent in particular. We want our buy to let customers to be in a position to be able to meet the changing needs of the market.
“According to Shelter, one in five families now rent rather than own, so giving the option of longer-term tenancies will bring greater stability to renters.
“To help fulfil Nationwide’s pledge of helping 750,000 people into a home of their own over five years, we are developing innovative solutions to housing problems, and this development is another indication of that commitment.”
Campbell Robb, chief executive of Shelter, said: “This news is very welcome recognition that six or twelve month tenancies just aren’t working for England’s nine million renters. More and more families are now renting their homes, but all too often short tenancies mean changing schools, leaving friends behind and growing up with constant upheaval.
“With two-thirds of renters saying they would like the option of staying in their home long-term, it’s encouraging that Nationwide is leading the mortgage industry to help make renting more stable. We look forward to other mortgage lenders following suit.”