Over the past month, lenders and landlords alike have been navigating a changing backdrop, yet overall activity has remained relatively stable. As funding conditions adjusted, mortgage pricing moved higher – a shift felt most keenly within buy to let (BTL) – but this has not been without thoughtful response. Many landlords are taking a more considered approach to managing costs and maintaining long-term sustainability.
It’s within this context that a number of product and criteria changes have come through in the BTL space.
Let’s take a look at some of these as the market continues to recalibrate.
The BTL mortgage market at the moment
To kick us off, CHL Mortgages reduced rates by up to 25 basis points (bps) across its short-term let products and by up to 10bps across its limited edition BTL range. Rates for short-term let properties such as holiday lets or serviced accommodation now start from 3.46%. Limited edition rates for single dwelling properties start from 2.85% and from 2.95% for houses in multiple occupation (HMO) and multi-unit freehold block (MUFB) properties.
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All products are open to individual and limited company landlords, offer a choice of fee options and loan to values (LTVs) up to 80%.
Fleet Mortgages reduced existing five-year fixed rate products with a 3% fee by 20bps across its standard, limited company and HMO/MUFB ranges. These are now priced at 5.04% up to 75% LTV for standard and limited company applications and at 5.49% for HMO/MUFB. Fleet has also reintroduced fixed-fee and zero-fee five-year fixed rate product options across the same ranges.
Reductions of 0.2% across selected core two- and five-year fixed rate products have also been announced by Landbay, alongside an increase in maximum loan sizes for standard products. The move offers greater flexibility to advisers, particularly where larger loan amounts are required. The reduced rates include core standard and automated valuation models (AVM) two-year fixed rates starting at 4.19%, with a 5% fee or 5.69%, with a 2% fee.
Standard products now have an increased maximum loan size of £1.5m.
Vida has updated rates with cuts up to 80bps on selected products and higher fee options have returned to give more choice and flexibility to advisers and their clients.
Foundation added to its large HMO and short-term let ranges this month to support these two growing areas of the BTL market. The lender is offering both two- and five-year fixed products in the large HMO range. The two-year fixed is available at 5.29% with a 3% fee up to 75% LTV, whilst the five-year fixed is priced at 5.99% with a 4% fee. The short-term let products are priced from 5.19%, for a two-year fixed up to 75% LTV with a 3% fee.
Paragon Bank launched a limited-edition BTL range at 60% LTV for both single self-contained properties (SSCs) and HMO/MUBs. Both two- and five-year terms are available.
Rates start from 4.35% for an SSC with an energy performance certificate (EPC) rating of A–C for a two-year fixed with a 3% product fee. For HMOs or MUBs, rates start at 4.60%. Products are available for both personal and limited company applications.
Accord Mortgages announced a higher BTL maximum loan for new business, helping your clients purchase or improve homes in higher-value areas. Up to 75% LTV, the maximum loan has increased to £1.5m, previously £1m. For LTVs between 75.01% and 80% LTV, the maximum loan has increased to £750,000, previously £500,000. This update excludes first-time landlords where the maximum loan is capped at £1m for loans up to 75% LTV.
Saffron for Intermediaries tweaked its criteria to give more flexibility when structuring solutions for clients. New-build flats are now accepted up to 75% LTV on an interest-only basis across all BTL products, previously capped at 60% LTV, plus there is a new 55% LTV tier across its BTL range, including for limited company ownership. The lender has also introduced new five-year fixed rate products this month across expat limited company BTL, HMO and HMO limited company BTL, standard BTL and contractor.
The market is evolving daily at the moment, so rapid change is almost guaranteed. It will certainly be interesting to see where we’re at by this time next month.
