Cost of buy-to-let mortgages fall year-on-year

Cost of buy-to-let mortgages fall year-on-year
13TH FEBRUARY 2020 PROPERTY NEWS, UK
BY RYAN BEMBRIDGE

The cost of buy-to-let mortgages have fallen year-on-year, research from Property Master has found.

The biggest fall was for 5-year fixed rate buy-to-let mortgage offers for 65% of the value of a property, which fell by £48 per month between February 2019 and February 2020 for a £150,000 mortgage.

Angus Stewart, chief executive of Property Master, said: “Another fall in the cost of borrowing is very good news for landlords.

“We know that there are landlords languishing on expensive SVR mortgages as the uncertainty around Brexit and political instability has put them off moving on to a more competitive fixed rate.

“With the current record low rates on offer these landlords should act quickly because if the “Boris bounce” becomes a reality it may allow interest rates to begin to rise back to more normal levels.”

Five-year fixed rates for a £150,000 mortgage for 50% of the value of the property fell year-on-year by £46. Five-year fixed rate offers for 75% of the value fell by £38.

Falls for two-year fixed rate buy-to-let mortgage offers were more modest.

The cost of a typical two-year fixed rate mortgage for £150,000 for 75% of the value of the property was down £25 per month year-on-year and for 65% of the value of a property by £19 per month.

Stewart added: “We are expecting a particularly busy next few months. This April it will be four years since significant changes were made to Stamp Duty.

“The decision by the then government to slap on a 3% surcharge on buy-to-let properties led to a mini-boom as landlords rushed to buy properties to beat the deadline.

“We suspect many of those landlords will be coming to the end of fixed rate mortgages around now and should be pleasantly surprised at what the market is prepared to offer them in terms of a good deal.”