Drop in cost of borrowing
Drop in the cost of borrowing ‘will be a boost for landlords’ The cost of buy-to-let mortgages has continued to fall, according to the latest research from Property Master.
The cost of buy-to-let mortgages has continued to fall, according to the latest research from Property Master. The biggest month-on-month fall in cost was for two-year fixed rate buy-to-let mortgage at 50% loan-to-value (LTV), dropping by £12 per month between February and March for a £150,000 mortgage. A two-year fix at 65% LTV dropped by £3 per month, while the cost remained unchanged at 75% LTV. Angus Stewart, Property Master’s chief executive, commented:: “The good news on the cost of borrowing will be a boost for landlords just as yet another raft of regulatory and tax changes is set to bite. “From later this month [March 20th] the Homes (Fit for Human Habitation) Act will mean all tenants are able to take landlords to court if they feel their home is, for example, mouldy, damp or too cold. “Courts will have the power to force works to be carried out and may award compensation. Shortly after that in April landlords will need to demonstrate that all their properties have at least an ‘E’ energy efficiency rating or face substantial fines.” Despite a number of challenges, confidence among buy-to-let landlords is growing, reflected by the latest increase in new buy-to-let mortgages and remortgages reported by UK Finance. Stewart added: “Lenders continue to play an important role in supporting landlords by offering good deals and broadening their product offerings.” Property Master’s latest mortgage tracker shows that five-year fixes have fallen at a lesser rate than two-year fixes, dropping by £6 per month on a typical £150,000 property at 50% LTV and by just £2 on a 65% LTV. Five-year fixed rate offers for 75% of the value was the only category to see an increase in cost although that was only by £1 a month from £371 per month to £372.