Buy to let mortgage upper limits are rising, allowing property investors to buy properties costing in the millions to rent out.
Many high-income individuals choose to rent property rather than buying, enjoying the extra flexibility that renting can offer. So, can buy to let property investors take advantage of high upper limits to enter the luxury housing market?
When offering home loans, lenders set maximum limits on how much they will offer to borrowers who meet their criteria. These upper limits can vary depending on the loan-to-value ratio (LTV) that you’re borrowing at – with lower LTVs sometimes offering higher limits.
The latest lender to increase upper limits on their buy to let mortgages is Coventry Building Society who has increased its maximum buy to let borrowing limit to £750,000, meaning it now offer mortgages on properties worth up to £1.5 million.
However, some other lenders already offer upper limits far higher than that on their buy to let products.
Metro Bank and Bank of China both offer buy to let investors maximum loans of £5 million at up to 60 and 65 per cent LTV respectively. This means that you could buy a property worth more than £8 million if you have a handy £3 million as a deposit.
Metro Bank will also offer up to £3 million at 70 per cent LTV, while Kent Reliance can offer the same upper limit at 75 per cent LTV.
If quite so large a deposit is a problem do not fear, Kent Reliance offers loans of up to £3 million at a much higher 80 per cent max LTV, meaning you can buy a property worth up to £3.75 million with just a £750,000 deposit. The same lender will offer up to £1 million at 85 per cent LTV.
Highest Buy to Let Upper Limits
| LTV | Lender | Max loan | Max property value |
| 60% | Metro Bank | £5m | £8.3m |
| 65% | Bank of China (UK) | £5m | £7.7m |
| 70% | Metro Bank | £3m | £4.3m |
| 75% | Kent Reliance | £3m | £4m |
| 80% | Kent Reliance | £3m | £3.75m |
| 85% | Kent Reliance | £1m | £1.2m |
Source: Residential Landlord