‘Rock bottom’ BTL rates won’t stick around for long, warns expert

Research from Mortgage Brain’s buy-to-let product data showed that the cost of many buy-to-let deals has fallen in the last three months. A three-year fixed buy-to-let mortgage with a 60% loan-to-value (LTV) is now 3% lower than it was in February at 2.44% (as of 1 May 2017).

A two and three-year fixed BTL (at 2.50% and 2.74% respectively) – both with a 70% LTV – have seen a 2% reduction in cost over the past quarter and offer landlords an annual saving of £648 and £324.

Mark Lofthouse, CEO of Mortgage Brain, said: “It’s really been a period of little activity across the market in the movement of rates and costs over recent weeks and months. The residential market, in particular, has seen very little change since the start of the year.

 “Our latest analysis, however, shows that buy-to-let investors are still in a good position to take advantage of the low rates and cost reductions that we’ve seen over the past three months.”

However, such low rates may not be around for long.

Ying Tan (pictured), managing director, Buy to Let Club, said: “Over the last year or so lenders have been keen to support landlords in what has clearly been a challenging market.

“Criteria changes, made in an attempt to adhere to new regulations and rules, have not exactly helped lenders win new business so rate cuts has been one way of counteracting that. There are certainly some impressive rates around at present.”

Despite the welcome news that rates have fallen, Tan warned they can only fall so far.

He added: “Now is certainly a good time for landlords to invest as I expect we won’t see these rock bottom rates stick around for too long.”