Buy-to-let mortgage costs remain stable

The cost of taking out a buy-to-let mortgage remains at an historic low, and it is likely that this will remain the case for the foreseeable future, according to the latest analysis from Mortgage Brain.

Despite going through another period of change and uncertainty, the cost of a number of mainstream buy-to-let mortgages remains broadly unchanged.

A 60% and 70% loan-to-value (LTV) two-year tracker and a 60% LTV three- and five-year fixed, have, for instance, all remained stable over the past three months with BTL mortgage costs remaining static when compared to the costs at the start of March.

The cost of a 70% LTV three- and five-year fixed rate BTL mortgage dropped by just 1% over the corresponding period.

The reduction in cost, while marginal, does offer potential BTL investors an annualised saving of £108 and £126 respectively on a £150,000 mortgage.

By contrast, the cost of a 60% and 80% LTV two-year fixed and an 80% LTV two-year tracker and three-year fixed have all increased by 1% since March 2018.

The biggest movement over the past three months, however, comes in the form of a 70% LTV two-year fixed, which now costs 3% more than it did in March and equates to an annualised cost increase of £198.

The BTL market still remains in a healthy position compared to this time last year, however, with Mortgage Brain’s data showing cost reductions for the majority of BTL products over the past 12 months.

Mark Lofthouse, CEO of Mortgage Brain, comments, “Our latest BTL product data analysis shows that while there’s little to get excited about in terms of rate and cost movement over the past three months, the longer term analysis is still favourable with the majority of products benefiting from costs reductions over the past 12 months.”

“The Bank of England’s decision to hold base rates last month should also be welcome news to borrowers as they can continue to make the most of the record lows in terms of costs in the BTL market.”

We're excited to announce that we're working on building a shiny new website for readers of Landlord Today! As part of this process, commenting on articles will be temporarily disabled. We look forward to sharing our new and improved Landlord Today website with you shortly!