Buy to Let Mortgage Rates fall to their Lowest Level Ever

Buy to Let Mortgage Rates have fallen to their lowest level in history, with deals now on offer that are cheaper than the best products available immediately before the global financial crisis. So, if you’re thinking of investing in property then now could be the best time ever according to experts.

As well as low rates, arrangement fees on buy to let high value mortgage deals are also falling as the cost of borrowing for property investors plummets.

Buy to let deals fall to just 2.49 per cent

The Daily Telegraph reports that the best two-year buy to let mortgage rate has hit 2.49 per cent, more than two percentage points lower than the very lowest rate in August 2007. The newspaper also reports that strong competition between large mortgage lenders has pushed down fees, with around one in 10 mortgages now available without any arrangement fees.

A sixth of the population – some 10 million people – now live in private rented accommodation and it is this rise in demand for rental property that is pushing up demand for high value mortgage deals.

Islay Robinson, CEO of London mortgage adviser and large mortgage experts Enness Private Clients, said: “Lenders are increasingly keen to take a share of the booming buy to let mortgage market and have slashed their margins in an attempt to bring in new business. This means that landlords are benefiting from some of the lowest rates on record.”

The lowest two year rate is now 2.49 per cent. Offered by the Mortgage Works it requires a deposit of 40 per cent and it has a 2.5 per cent fee. In August 2007 the lowest two year fixed rate was 5.29 per cent for loans up to 75 per cent loan to value, also through the Mortgage Works.

Five year rates are also much cheaper than they were six years ago. In August 2007 the lowest fix was Cheltenham & Gloucester’s 5.84 per cent deal up to 85 per cent loan to value with a 2.5 per cent fee. Now the lowest rate is Accord Mortgages’ 3.79 per cent deal up to 75 per cent loan to value with the same fee.

Research from a leading broker has also found that the proportion of products with no lender arrangement fee was 10.8 per cent in December, up from 7 per cent in the previous two quarters.

Lenders targeting landlords as rental demand soars

Mr Robinson, the high net worth mortgage expert, added: “A large number of lenders withdrew from the buy-to-let market during the financial crisis but many are now returning as demand from landlords soars.

“As well as the traditional buy to let lenders a range of ambitious mutuals are also targeting landlords. The Coventry, Skipton and Yorkshire building societies – the latter through their Accord Mortgage division – are all aggressively targeting buy to let borrowers.

“As with any mortgage product it can pay to take advice from a broker before signing on the dotted line. As well as helping you find the best deal with the most reasonable fee a broker also knows which lenders to approach for more unusual property types. They can also find a lender with more generous lending criteria to enable you to maximise your borrowing based on the anticipated rental income from your investment property.”

Arrange to speak to an Enness Broker