Landlords benefit from boost in buy-to-let mortgages
The number of buy-to-let mortgages has jumped by 7% in the last month to reach its highest level since December 2007, said Moneyfacts.
The financial information provider said that the number of deals has hit its highest level in almost a decade, according to data from its UK Mortgage Trends Treasury Report.
A massive 1,725 buy-to-let mortgages are now available to landords, the highest number since the 1,942 products that were recorded in December 2007. Over 100 new deals have been introduced for landlords in the last month alone.
Charlotte Nelson, finance expert at Moneyfacts, said: “The market has clearly recovered from the tougher affordability rules that were put in place on 1st January, when it saw a dramatic drop in the number of products available to landlords. Since then, the number of deals on offer has gone from strength to strength, culminating in a rise of 7%, the highest month-on-month growth Moneyfacts has seen in 2017.
“Despite reduced buy-to-let activity in the first quarter of this year, competition among lenders remains high as providers fight to retain their standing in a diminished market.”
The increased competition has led to further falls in the cost of borrowing for landlords, said Moneyfacts. The average two-year buy-to-let fixed rate dropped from 2.91% in August to 2.86% in September hitting another record low. This leaves borrowers looking for a buy-to-let mortgage today in a good position, said Nelson.
“Providers are now starting to get ready for further changes at the end of September, which will see lenders apply stricter standards to those with four or more properties,” she explained.
“It is still uncertain how providers will choose to react to the new changes, but product numbers could climb as providers start to target their products to the two different types of borrower. However, despite this increased choice, rates might not improve.”