{"id":6029270,"date":"2020-02-07T09:15:45","date_gmt":"2020-02-07T09:15:45","guid":{"rendered":"https:\/\/www.buyassociation.co.uk\/?p=6029270"},"modified":"2020-02-07T09:15:45","modified_gmt":"2020-02-07T09:15:45","slug":"falling-rates-buoy-buy-to-let-mortgage-market-for-landlords","status":"publish","type":"post","link":"https:\/\/www.buyassociationgroup.com\/en-us\/news\/falling-rates-buoy-buy-to-let-mortgage-market-for-landlords\/","title":{"rendered":"Falling rates buoy buy-to-let mortgage market for landlords"},"content":{"rendered":"

Brokers are expecting the buy-to-let market to become even more competitive this year, with one in five lenders expecting to introduce more buy-to-let business during 2020.<\/strong><\/p>\n

The buy-to-let sector<\/a> (BTL) has been buoyed in recent months with falling mortgage rates, and the competition between lenders shows no sign of abating, according to a study by Paragon Bank. Further research by Moneyfacts.co.uk has found that the average rates charged on two- and five-year fixed rate BTL mortgages have fallen by more than a 0.25% year on year since 2015.<\/p>\n

In February 2015, the average five-year fixed rate was 4.39%, while today it sits at 3.20%. Likewise, the average two-year fixed rate has fallen from 3.5% to 2.75%.<\/p>\n

Rachel Springall, finance expert at Moneyfacts, said: \u201cIt\u2019s encouraging to see that, despite <\/span>economic pressures<\/a>, the buy-to-let market is expected to grow in 2020.”<\/span><\/p><\/blockquote>\n

Changing property investment landscape<\/h4>\n

Lenders are expecting landlords to be looking to reduce their monthly loan repayments as a result of the phasing out of the mortgage interest tax relief<\/a> by April this year. Landlords will no longer be able to deduct mortgage expenses from rental income to reduce their tax bill, which for many means less rental income and a bigger tax bill at the end of the year.<\/p>\n

With squeezed profit margins, landlords will be looking to make savings<\/a> wherever they can, and lenders are continuing to work hard to entice landlords to their books.<\/p>\n

Significant savings for landlords<\/h4>\n

According to Moneyfacts, a landlord looking to switch deals could make a good saving on their monthly payments. A landlord coming to the end of a five-year fixed term this year will find that the average rate has dropped by a significant 1.19%, saving them a considerable amount. This would equate to a difference of \u00a31,947 a year in monthly repayments if a landlord were to take a loan of \u00a3250,000 on a 25-year term compared to back in 2015 for the same amount and term.<\/p>\n

Springall adds that “…optimism for 2020<\/a> appears resilient and lenders are clearly working hard to entice prospective borrowers\u201d.<\/p>\n

Today, landlords with a maximum 65% loan-to-value (LTV) could secure a five-year fixed rate from The Mortgage Works for just 1.59%, with a 2% product fee, or at 75% LTV a rate of 1.89% plus 2% fee.<\/p>\n

In fact, the evidence suggests that landlords are already taking advantage of the competitive market place. Paragon Bank found that 61% of buy-to-let landlords that took part in their research had obtained a new deal by remortgaging during the last quarter of 2019 to secure a better rate.<\/p>\n","protected":false},"excerpt":{"rendered":"

Brokers are expecting the buy-to-let market to become even more competitive this year, with one in five lenders expecting to introduce more buy-to-let business during 2020. The buy-to-let sector (BTL) has been buoyed in recent months with falling mortgage rates, and the competition between lenders shows no sign of abating, according to a study by… Read more »<\/a><\/p>\n","protected":false},"author":3380,"featured_media":5023905,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":""},"categories":[2,26],"tags":[412,15],"class_list":["post-6029270","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-buy-to-let-landlords","category-tax-mortgages-money","tag-buy-to-let-mortgages","tag-landlords"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/posts\/6029270","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/users\/3380"}],"replies":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/comments?post=6029270"}],"version-history":[{"count":0,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/posts\/6029270\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/media\/5023905"}],"wp:attachment":[{"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/media?parent=6029270"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/categories?post=6029270"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.buyassociationgroup.com\/en-us\/wp-json\/wp\/v2\/tags?post=6029270"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}