According to research by the Mortgage Lender, buy-to-let mortgages still represent 13% of all new UK mortgages lending, but buy-to-let house purchases fell by 11% in the first quarter of 2018.
Samantha Taylor, writing on the website BuyAssociation.co.uk, argues that landlords need support to encourage more activity in the buy-to-let property sector. Experts have predicted that by 2032, 35.2% of all properties in the UK will be rented. If this figure is to be reached, Taylor believes that lenders need to offer more attractive deals, as it is currently more expensive to be a buy-to-let landlord than it used to be.
This is starting to happen already to some extent. Lenders are offering lower rates, increased loan to value percentages and added incentives in their commercial mortgage deals for buy-to-let property.
To offset the costs of reduced tax relief on commercial mortgage payments, many landlords are diversifying by purchasing houses of multiple occupancies, which earn more in rent form multiple tenants than a single tenant. Two-year fixed rate mortgages at 70% loan to value can be found with rates of about 2.69%.
Lenders have increased the number of loan deals available for first time-landlords. The maximum age to apply for a mortgage has been increased to 70 years by some lenders.
Landlords now have greater choice in lenders and mortgage products. A mortgage broker can source the best possible deals for landlords and provide advice for first-time landlords, ensuring everyone gets off to a suitable start.