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BTL mortgage rates moving down

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Buy-to-Let mortgage rates have been moving down.

Average two and five year fixed BTL mortgage rates have fallen since the start of May and are currently at their lowest levels since the beginning of this year, Moneyfacts consumer finance specialist Michelle Monck has reported.

‘Our research into the BTL mortgage market has found that since the start of this month, the average two year fixed BTL rate has fallen by 0.04 per cent, down from 2.99 per cent on the 1 May to 2.95 per cent on the 21 May. Meanwhile, the average five year fixed BTL rate has fallen by 0.05 per cent during this same period, down from 3.35 per cent to 3.30 per cent’, she said.

‘This seems to show an appetite for business from lenders to cater to borrowers who are keen to invest. Indeed, as providers continue to tweak their ranges, we have seen rate reductions of as much as 0.90 per cent from TSB, while Virgin Money made cuts of up to 1.06 per cent on a selection of its products this month’.

Falling BTL mortgage rates will benefit both landlords looking to re-mortgage, and those considering investing in the market, said Monck. ‘While it goes without saying that the last year has presented great challenges to many investors in the sector, the latest Lettings Index from Hamptons illustrated that rents have risen by 5.9 per cent in Great Britain in April 2021, the fastest rate of growth it has recorded since January 2015’.

The lowest two year fixed rate currently available in the Moneyfacts chart is a deal from The Mortgage Works offering 1.19 per cent (4.5per cent APRC) fixed until 31 July 2023 and then reverting to 4.74 per cent variable. This deal is available at a 65 per cent loan-to-value (LTV).

The lowest two year rate at a 75per cent LTV comes from Santander, which offers 1.55 per cent (3.2 per cent APRC) fixed until 2 September 2023 and then reverting to 3.35 per cent variable.