Analysis of the deals on offer from lenders including Barclays, BM Solutions, RBS, The Mortgage Works, Godiva and Precise found the average rate on a £150,000 buy-to-let mortgage has dropped across both short and long term periods.
The research, by online broker Property Master, shows the biggest fall in the monthly cost was for five-year fixed rate buy-to-let mortgage at 75% LTV, which fell by £36 in one month.
Five-year fixed rates for 65% LTVs also fell by £6 per month.
Two-year fixed rate buy-to-let mortgages for 50% and 65% of the value of a property fell by £5 each, while those at 75% LTV were down by £8 per month.
Angus Stewart, chief executive of Property Master, said: “We have been tracking buy-to-let mortgage interest rates in this way for 18 months and we have never seen before a fall across the board in this way.
“It is quite unprecedented. [In June] we saw a drift upwards in the cost of buy-to-let fixed rate mortgages but it may be that the market is now expecting rates generally to fall rather than rise.”
“It is likely that lower rates are also being fueled by the continuing increase in the number of buy-to-let mortgage products.
“Whilst it is true some lenders have exited the market others are boosting their range and competing hard for new business.
“As landlords continue to be pressed on all sides by rising regulatory cost such as the new Tenant Fees Act and falling tax reliefs, today’s news of a lowering of mortgage costs will be very much welcomed.”
It comes after Moneyfacts reported that the number of buy-to-let mortgages on the market had hit the highest level since 2007.