Fixed rates in the buy-to-let mortgage space have fallen across the board, according to online mortgage broker, Property Master.
Angus Stewart, Property Master’s chief executive, described this as “unprecedented”, and follows on from recent remarks by the Governor of the Bank of England that the UK leaving the European Union without reaching some sort of trade agreement may well require some sort of economic stimulus such as a cut in rates to weather the shock of no deal.
He commented: “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.
“Last month we were seeing 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 fuelled 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 costs 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.”
Property Master’s July 2019 Mortgage Tracker shows the biggest fall in monthly cost was for five-year fixed rate buy-to-let mortgage offers for 75% of the value of a property. The monthly cost fell by £36 per month June to July.
Five-year fixed rates for 65% loan-to-value fell month on month by £6. Five-year fixed rates buy-to-let mortgage offers for 50% of the value of a property fell by just £3 per month.
Two-year fixed rate buy-to-let mortgages for 50% and 65% of the value of a property fell by £5 each. Two-year fixed rate buy-to-let mortgages for 75% of the value of a property fell by £8 per month.
The Property Master Mortgage Tracker follows a range of buy-to-let mortgages for an interest-only loan of £150,000. Deals from 18 of some of the biggest lenders in the buy-to-let market including Barclays, BM Solutions, RBS, The Mortgage Works, Godiva and Precise were tracked. Figures for this month’s Mortgage Tracker were calculated on deals available on July 1, 2019.
Property Master was launched almost two years ago and aims to shake up the buy-to-let mortgage market currently served by around 12,000 mortgage brokers. It has already attracted financial backing from a broad range of private investors including a minority stake being taken by LSL Property Services, whose estate and letting agency brands include Your Move and Reeds Rains.
Property Master has automated what was a manual, complex process to provide landlords with a free easy to use mortgage search tool which provides a mortgage quote that is pre-screened against each lender’s specific and changing criteria.
By Joanne Atkin
Source: Mortgage Finance Gazette