"The mixed and marginal movement in costs over the past three months could be seen as a further sign of stability, or even the start of a period of rises."
Over the past three years there has been strong year-on-year reductions in the cost of BTL mortgages. The cost of an 80% LTV two-year fixed rate is now 18% lower than it was at the start of 2014 and 11% lower than it was a year ago.
Similarly, the lowest rate three-year fix at 80% LTV (3.39%) is now 16% lower than it was three years ago and 10% lower than last year.
The cost of a 60% LTV five-year fix is now 15% lower than it was in 2014, while its 70% and 80% LTV counterparts are 14% and 11% lower respectively.
However despite the long period of reducing mortgage rates, Mortgage Brain’s short term analysis shows signs of potential stabilisation with mixed movement in the cost of all main BTL products over the past three months.
A three-year fix at 80% LTV, for example, now costs 4% less than it did three months ago, while the cost of a two-year fix (60% and 80% LTV), a three-year fix at 70% LTV, and a five-year fix with a 60% LTV are all down by just 1% compared to November 2016.
By comparison, a marginal 1% increase in cost has been recorded for a 70% LTV two-year tracker, whereas a two-year fix (70% LTV), a two-year tracker (60% LTV) and a five-year fix (70% and 80% LTV) have all remained inactive with mortgage costs remaining static with those offered at the beginning of November 2016.
Mark Lofthouse, CEO of Mortgage Brain, commented: “Like our recent residential mortgage product analysis the buy-to-let sector looks like it could be levelling out and moving away from the long period of historic lows in terms of costs and rates.
“Buy-to-let investors can still take advantage of some good savings and low rates when compared to this time last year, however, the mixed and marginal movement in costs over the past three months could be seen as a further sign of stability, or even the start of a period of rises.”
