Landlords have more mortgage products to choose from this month, although the range is still well below levels seen earlier this year
The number of buy-to-let mortgages has slowly started to creep up after being shrunk by half during the lock-down.
Landlords were limited to a choice of 1,455 products in May – down from 2,897 in March – but during the last two months lenders have added 283 more products to their ranges. There are now 134 more two-year fixed products in the buy-to-let sector than there were at the start of May, along with 164 more five-year fixed rate products, according to Moneyfacts.co.uk. It says average rates have stayed competitive, especially compared to January; the average rate for two-year fixed rate mortgages on 1st July was 0.21% less than at the start of this year, while the five-year fixed rate has fallen by 0.22% over the same period.
Finance expert Eleanor Williams says the ongoing impact of the recent lockdown has affected both product choice and rates. She adds: “The shock of the Coronavirus pandemic and its resultant effects has been the latest event to impact the beleaguered buy-to-let mortgage market, following on from a number of changes over recent years that affected stamp duty, interest relief and capital gains tax. However, the buy-to-let sector has adapted well and there are indications that landlords may have cause for positivity.”
Williams believes that the increase in product choice and the fact that average rates remain competitive could be early indications that the sector is starting to recover. She adds: “Due to continuing economic uncertainty and few low-deposit residential mortgage deals available, there may be increased demand for private rental properties, which those landlords in a position to capitalise on may wish to consider.”