As the newspapers remind us on almost a daily basis, we’re living in a period when more and more people live in rented homes. For investors, then, the time is ripe for buying more properties and expanding their portfolios.

The current state of the rental market presents a unique opportunity for property investors who can take on units, undertake light refurbishment, and then let them out to an eager market of young professionals, students or families.

Investor clients are always looking to maximise their returns, so the opportunity to add value or increase the yield or marketability of the property through refurbishment is often a key goal. As there are now a greater number of short term products designed with this in mind, these clients have more finance options than ever before. Some lenders are also more open to providing short term loans for those investing in HMOs and multi-units than previously. The profit margins on these particular properties can be substantial. Switched on investors are increasingly taking advantage of these opportunities, which is advantageous both to those seeking rented accommodation - as their options are extended - and to the market as a whole, which is showing significant growth as a result of these investments.

The savviest brokers and clients working in this market understand the possibilities offered by refurbishment work better than anyone. Their expertise points them to the most profitable locations and properties for this kind of investment. For example, the number of students in the UK has increased from 98 million in 2000 to 165 million in 2011, so investing in student rental accommodation can yield significant returns at the moment. But an understanding of the right location is absolutely critical. Choosing suitable properties in the areas around the top 20 Russell Group universities, and those with a high proportion of non-EU students, appears to make for a sound investment in the current climate.

The rewards for the brokers involved in refurbishment loan deals are substantial. At Shawbrook we ensure that we work only with experienced investors who have undertaken similar refurbishment in the past. We have found that once we understand these clients and their models, they don’t just use us on one transaction but will return to us for repeat business opportunities. Our brokers are a vital part of this process and ‘own’ those individual clients, so all future business will be managed and submitted by that broker and they will receive recognition for all the deals completed with Shawbrook.

We offer brokers 1.5 per cent commission on our short term finance cases, plus the ability to deduct a broker fee of up to 1.5 per cent on completion. All our refurbishment products are specifically tailored for residential and mixed-use light refurbishment, and we offer a product with three and five-year term finance options too, allowing brokers and investors to have the flexibility to choose a product that fits with their current project and any changing circumstances. Shawbrook is committed to becoming a market leader in this area, which is why we no longer have a minimum term requirement for our short term loans, and reduced our rates early this year to just 0.73 per cent per month for refurbishment loans and 0.65 per cent for standard short term finance.

All Shawbrook’s commercial mortgage deals are made through our much-valued network of brokers, and we’re enjoying extending these relationships through working with them on short term cases. It seems to us that for brokers, investor clients, and lenders alike, the opportunities presenting themselves in the rental and refurbishment markets at the moment are making for an exciting and profitable period. We’re really pleased to be a part of it.