Landlords seeing more buy-to-let mortgage choice

Despite the raft of tax changes being and anti-landlord measures being levied by the Government, more people are turning to buy-to-let investment.

Many of these investors are being lured to the sector due to historic low borrowing rates. Indeed, many lenders have turned to reduce their buy-to-let mortgage rates recently, amidst greater competition in the sector.


The most recent figures released by Moneyfacts show that the average two-year fixed buy-to-let rate has slipped by 0.31% over the course of the year. Despite the pace of decline sliding in recent months, the market is showing signs of recovering from the products seen at the beginning of the year.

A rise in the volume of buy-to-let mortgage products on the market has occurred since the significant fall seen in January. As a result, landlords are now seeing more choice when looking for a mortgage deal today.

Charlotte Nelson, Finance Expert at Moneyfacts, noted: ‘The BTL market has seen some turbulent times, with significant tax changes, tougher affordability rules and more changes to come into force in September. It is little wonder many thought the BTL mortgage market might show signs of strain. And yet, rates have continued on a downward path. Since the introduction of new regulation in January, however, the pace of the reductions has slowed considerably.’[1]

Landlords seeing more buy-to-let mortgage choice

Landlords seeing more buy-to-let mortgage choice

Regulatory Changes

Mortgage lenders are now beginning to gear up for more regulatory changes coming into force later this year. From 30th September, lenders will be required to apply stricter standards for those landlords with four or more properties.

Nelson observes that as 89% of current mortgage deals are available for borrowers with four or more properties, these changes will impact on a large chunk of the market.

‘Faced with these changes, it is likely that competition among providers may start to ebb initially, with the providers instead focusing on their core range and getting their criteria up to date. With the added uncertainty in the economy, landlords looking for a mortgage deal are likely to face a bumpy road for a while. Anyone unsure of their options should seek out independent financial advice,’ she concluded.[1]



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