"With further interest rate cuts predicted by the Bank of England it will be interesting to see what happens to mortgage rates and costs over the next few months."
Mortgage Brain data shows that the cost of a five-year fixed BTL mortgage with a 70% LTV is now 8% lower than it was in March 2016.
With a rate of 2.80% in September 2016, the reduction in cost for this product equates to a potential annualised saving of £738 on a £150,000 mortgage.
The cost of the lowest rate three year fix at 2.64%, and a two year fix at 2.89% - both with a 70% LTV – have seen a 6% reduction in cost since March and offer landlords an annualised saving of £504 and £540 respectively.
Buy-to-let mortgages with a 60% LTV have also come down in cost over the past six months with a five year fixed rate down 5%, a three year fix down 4%, and a two year fix down 2% in cost since March 2016.
However some two year tracker rates have increased in cost. The cost of the lowest rate 80% LTV product (at 2.97%), for example, is now 14% higher than it was in March 2016.
At 1.80% over two years the cost of a two year tracker with a 60% LTV is now 3% higher, while the same product with a 70% LTV is now 1% higher.
Mark Lofthouse, CEO of Mortgage Brain, commented: “With further interest rate cuts predicted by the Bank of England it will be interesting to see what happens to mortgage rates and costs over the next few months.
“There’s no doubt though that on the whole borrowers and potential BTL investors are in a great position to take advantage of the low rates and cost reductions that we’re seeing.”
