Buy-to-let mortgage rates are continuing to fall in what is a real boost to investors.
The majority of ‘mainstream’ buy-to-let mortgage products have seen rate reductions in the last three months, according to new research from mortgage technology provider, Mortgage Brain.
For some buy-to-let mortgage products, the loan to value has dropped by 4% when compared with May this year.
Mortgage Brain’s Chief Executive, Mark Lofthouse, said: “Despite the forthcoming changes to buy-to-let lending, the outlook for investors at the moment is extremely favourable with BTL mortgage costs coming down yet again.”
The rates reduction is positive for borrowers. But changes are expected in the coming months, and it will be interesting to see how the market adapts.
Buy-to-let investors have been hit by a series of changes brought in by the government, which may affect their profit margins. Mortgage interest tax relief is gradually being cut back, while an extra 3% stamp duty surcharge, introduced in April 2016, applies to the purchase of second properties.
However, many investors, in particular those with established portfolios, are still reaping the benefits of the buy-to-let market.
Alastair McKee, Managing Director of One 77 Mortgages, said: “A lot of people, especially portfolio landlords, have done very well out of buy-to-let over the years and are in a strong position as a result.
These more committed landlords are adapting to the new regime rather than running away from it. They still see buy-to-let as a viable investment, just one that needs a lot more attention and management in order to maintain a [the profit] margin.”
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