"This could be one of the last times that our analysis reports reductions in the cost of mainstream BTL mortgages."
A number of mainstream buy-to-let mortgages are down in cost since August – some for the second successive quarter - despite the new PRA changes and months of rate rise predictions, according to Mortgage Brain data.
With a current rate of 1.54% and 1.89% respectively, the cost of a 60% and 70% LTV two-year buy-to-let tracker, for example, is now 2% lower than it was three months ago.
The cost of a two-year fixed rate mortgage with a 60% LTV (at 2.08%) is now 1% lower than it was at the beginning of August, while its 70% and 80% LTV counterparts remain stable with no movement in cost being recorded over the same period.
A similar trend can be seen in the cost of longer term products with Mortgage Brain’s latest data showing a 2% drop in the cost of a 70% LTV three and five-year fixed rates, while the cost of a 60% LTV three and five-year fix and an 80% LTV three-year fix all remain unchanged when compared to August 2017.
The only sting in the tail comes in the form of a five-year fixed rate buy-to-let mortgage which, with a current rate of 4.09%, now costs 2% more than it did three months ago and 1% more than it did at the beginning of October.
Mark Lofthouse, CEO of Mortgage Brain, commented: “With interest rates rising for the first time in just over 10 years, and further increases predicted, this could be one of the last times that our analysis reports reductions in the cost of mainstream BTL mortgages.
“While our three, six and 12 month analysis all show potential cost savings for BTL investors, we’re already starting to see ripples across the market following this month’s rate rise. Our most recent monthly data, for example, shows signs of a number of cost increases when compared to last month and it will be interesting to see how this develops in the coming months.”