Landlord product numbers fall, as rates tick down
The choice of buy-to-let mortgage products has fallen since the start of July, by 78, and now sits at 1,660, according to Moneyfacts.
But the financial information provider pointed out this is still more than the low of 1,455 deals available on 1st May 2020.
Eleanor Williams, finance expert at Moneyfacts.co.uk, said: “Over the last six months, the buy-to-let sector has been a little more resilient than the residential market in terms of product choice. However, this sector has contracted since 1st July.”
Rates below March level
There is some good news for landlords. Average two and five-year fixed rates for all buy-to-let mortgages are lower now than they were at the start of the Coronavirus pandemic, said Moneyfacts, down 0.05% and 0.13% to 2.72% and 3.11% respectively compared to 1st March.
However, not all borrowers will benefit. When you look at some mortgages, such as those for landlords with a large level of equity, the cost of borrowing is starting to creep up.
Two and five-year rates in the 60% LTV bracket have increased, now sitting 0.53% and 0.45% above where they were in March.
Williams added: “There are still competitive deals to be had in this current low base rate environment and an indication of an appetite to lend from providers in this sector. However, a note of caution, as since 1st August, average two and five-year rates have risen by 0.06% and 0.05% respectively – a fact that may prompt some investors to consider their options before these potentially increase further.”
“Landlords looking to invest in the buy-to-let sector could see this as an opportune time to explore their options, especially if they think that average rates may continue the upward trajectory we have witnessed over the last two months.”