The Intermediary – September 2026 - Flipbook - Page 39
I N T E RV I E W
dependent on BTL, particularly when the
market has faced ups and downs.
Sedgwick continues: “There’s a massive
influx of new lenders coming into the market,
and those that have already got a place are
then changing and adapting lending criteria.
“The market is becoming more aggressive.
We’re seeing a lot of mainstream players that
are deposit takers, for example, coming in with
much cheaper funding. We have to constantly
sharpen our pencil, whether that be service,
product related, innovation or systems.”
Fundamental to the ecosystem
The PRS is not just a behemoth in its own
right. Renting is a natural part of the housing
lifecycle for the vast majority of people,
from prospective first-time buyers to ‘silver
separators’, downsizers, those who choose to
sell without immediately buying, or who prefer
not to buy at all.
There are landlords now
who are having to support
their rental properties because
of the difference between the
rent and the cost of running it.
Meanwhile, if the only point
where they can fix their rent
is when it goes back on the
market, rents could actually
go higher”
Social housing also remains inadequate, so
the PRS also supports vulnerable households
that might otherwise be left out in the cold.
Emerson points out that BTL is also part
of the solution for developers unable to sell
completed stock. He says: “Offhand I can
probably think of 20 or 30 different developers
in my time that [BTL] has saved from going into
bank receivership and repossession, ensuring
that new housing stock is created.”
Sedgwick says this trend is coming to
the fore once again in the current market.
For Paragon, this is where having a broader
specialist proposition alongside BTL is key,
allowing customers to find the right support
under one roof.
The PRS punching bag
Legislation, regulation and taxation have been
major forces affecting BTL over the decades
since its inception. For many, the focus on this
market has been disproportionate.
The impact of increased restrictions and
scrutiny on landlords has meant the move to
limited companies and special purpose vehicles
(SPVs), and some would argue, the departure
of many of those who approached this market
more casually. One prevailing rhetoric is that
this is about “professionalisation” and can only
be a good thing, but Sedgwick disagrees.
“It’s a professional market whether
somebody holds a property in their own name
or in a limited company,” she says. “It frustrates
me when people say it’s a ‘more professional’
market. This is just about how they fund it.”
In fact, just as the broader housing market
needs the PRS as part of an array of moving
parts, it needs a spectrum of landlord types
to meet the needs of a diverse tenant base.
Sedgwick is clear that “we have some very
good small landlords, and some incredibly good
large landlords” and that business structure
should not be confused with managing
properties effectively.
For Paragon, success means being “very
particular” in who to lend to. Sedgwick
says: “We make sure that the landlords are
the right people to run a business, and the
right properties.”
Emerson agrees that the move to SPVs
and limited companies is not a change in the
professionalisation of the market, which has
always been about “the people that sit behind
it” regardless of the structure. Instead, he adds,
this is a reaction to “Government policies,
Stamp Duty, Capital Gains Tax, etcetera, the
changing parameters of which have made it a
less affordable model for many people.”
He agrees that “a blended approach is the
right fit for the UK market,” particularly while
other parts of the ecosystem, such as housing
associations, are struggling to meet what is
demanded of them.
Emerson says: “We should actually be
encouraging as many people as possible to help
with the supply of property.”
The most recent factor is the Renters’ Rights
Act. For Sedgwick, the concern is not just
about whether it will have an unfair impact on
landlords. She believes some of the measures
introduced will have a directly negative impact
on the tenants themselves.
“If you look at it on paper, it supports tenants
100%, it’s a good piece of legislation,” she →
September 2026 | The Intermediary
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