Buy To Let

To say that the buy-to-let market has faced challenges over the last few years would be something of an understatement. Changes made to stamp duty costs have made higher value properties in the South-East feel like a less attractive option, and diminishing mortgage interest rate relief has seen the profits of leveraged property portfolios drop. But is all of this about to change? According to some recent publications, the property market certainly seems to be improving for buy-to-let landlords.

Buy-to-Let Mortgage Costs Are Falling

Finally some good news for buy-to-let landlords. According to Mortgage Brain, the mortgage costs in the buy-to-let property market have been falling since the second quarter of 2019 as lenders are competing to offer the best deals.

There are now 3,859 buy-to-let mortgage products available from mainstream lenders on the market. The number of products available has risen by 11% in one year, which is a huge driving factor in the recent falling costs of fixed-rate buy to let mortgages.

Average Rents Are Increasing

In other news, rent across the country has also increased by an average of 2.3% year-on-year in August, fuelled primarily by growth in the South East according to figures from Hamptons International.

The South East and South West of the country both recorded very good annual rental growth of 5.6% to £1,112 and 5.5% to £852 respectively. Average rents in London grew 2% to £1,737. In the East of England, rents were up by 2.8% to £984 and in the North of England, they increased by 1.2% to £656.

Economic Uncertainty Should Become Less Volatile

The analysis from Mortgage Brain also reveals that the cost of buy-to-let mortgages remains higher when compared to more mainstream residential mortgage products and that the market remains clouded by the ongoing political uncertainty of Brexit and a weakening economic forecast.

No-one can really predict the outcome of Brexit but it may be that once the market is more certain about what is happening then this volatility will probably come to an end.

An Overall Positive Outlook for Landlords

Despite all of this, landlords remain resilient. Research from The Mortgage Lender shows 84 per cent are planning to maintain or increase the number of properties in their portfolio over the next 12 months with just 16 per cent looking to sell.

The overall message for buy-to-let landlords is positive, especially for property investors looking to borrow at a fixed-rate over a longer-term. The cost of buy-to-let mortgages continue to reach historic lows, with the market remaining competitive.

The need for specialist advice is important so that landlords can be confident that they are getting the best mortgage deal for their needs. Ashburnham Insurance is a specialist provider of portfolio Insurance for Landlords with multiple properties. We can cover residential properties let to tenants, houses of multiple occupation, commercial let properties and more.

You can click here to contact us or call us on 0800 1696137.

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