A busy month for the BTL market – Armstrong

Over recent weeks, we’ve seen plenty of positive movement in the market, from new product launches and criteria enhancements to rate reductions, but we’ve also seen our fair share of withdrawals and repricing as lenders respond to changing market conditions.

Against this backdrop, landlords remain firmly focused on managing costs, keeping on top of regulation and ensuring their portfolios continue to perform. For brokers, staying close to lender appetite and policy changes has never been more important, and so with this in mind, I’ve rounded up some of the changes from the last month to help you uncover those all-important opportunities for your landlord clients.

To kick us off, Zephyr Homeloans has reduced its large house in multiple occupation (HMO) and multi-unit freehold block (MUFB) lifetime tracker rates by 25 basis points (bps). This applies to properties with 7-12 bedrooms/units. Rates now start at 5.74% (bank base rate (BBR) plus 1.99%) up to 65% loan to value (LTV) with a maximum loan size of £2m and a 3% product fee. At 75% LTV, the rate is now 5.79% (BBR plus 2.04%) with a maximum loan size of £1.5m and a 3% product fee. These products feature no early repayment changes. The lender will also now lend to HMO/MUFBs that are above or adjacent to commercial premises, up to a maximum of 75% LTV.

Tipton & Coseley Building Society has launched a new two-year fixed rate for expat BTL borrowers priced at 5.64%. Available up to 70% LTV, this has an arrangement fee of £1,900 and is available for purchases by expats living in countries that are included in the Financial Action Task Force approved list and the UAE (subject to some exceptions). This change comes alongside the society’s reintroduction of high-income multiple mortgages in its residential range and a number of rate reductions.

Interbay has made a series of BTL enhancements this month. Its range now features a new 65% LTV option to provide more flexibility and a dedicated pricing band for loans between £10m and £25m. Rates have also been reduced by up to 20bps for both new customers and product transfers. For example, a two-year fixed at 75% LTV in the £1m-2m band, previously priced at 5.34%, is now priced at 5.14% with a 5% fee.

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Dudley Building Society announced reductions of up to 100bps across its BTL, residential, holiday let and expat ranges. Included in the change is the lender’s two-year fixed BTL product up to 80% LTV that is now available at 5.5% (down from 6.3%). Similarly, a two-year fixed holiday let product also at 80% LTV is now available at 5.55% (down from 6.3%).

Paragon Bank has updated its BTL BBR tracker range with the addition of a 2% fee product. This new product is available for single self-contained (SSC) properties at 75% LTV and is priced from BBR plus 1% (currently 4.75%). It features a free mortgage valuation, no application fee and no early repayment charges.

At the start of the month, CHL Mortgages launched a light refurbishment range aimed at investors wanting to make improvements such as installing a new bathroom or kitchen, new windows and doors, or updating fixtures and fittings. Two-year fixed rates start from 4.4% for single dwelling properties up to 75% LTV with a 5% fee and from 4.5% for small HMO and MUFB properties with up to six bedrooms or units. Five-year products in the same range start from 6.11% for single dwelling properties and 6.21% for small HMO/MUFBs.

Updates to criteria

Turning our attention to a few criteria updates, Kensington Mortgages has reduced its minimum property valuation across its BTL range. Both Prime and Core products are now available for properties valued from £75,000, providing greater flexibility to support landlords looking to buy or remortgage a lower-valued property.

Foundation has also reduced its minimum property valuation for BTL and Solutions cases this month. This has reduced from £75,000 to £70,000 where the LTV is 75% or lower. Where the LTV is greater than 75%, the minimum property value remains at £75,000.

Fleet Mortgages has announced that it will now consider joint applications involving foreign nationals if at least one applicant is a British passport holder, has Indefinite Leave to Remain (ILR) or settled status. Additional applicants may be accepted with eligible visas, provided they have lived in the UK for at least three years and have a minimum of 12 months remaining on their visa. In its limited company lending proposition, Fleet Mortgages has also said that it will now accept company group structures registered anywhere in the UK (previously, only England and Wales were accepted). However, the security property must still be located in England or Wales.

That’s all for now. Let’s hope for a bit of stability before we catch up again in a month’s time!