"Even now, 10 years on from the crisis, buy-to-let rates remain highly competitive as lenders compete to attract landlords operating in a somewhat challenging landscape."
It’s very easy to talk the market down at the moment. Several small-scale surveys have found some landlords are considering selling up, seemingly unfounded rumours of another Stamp Duty hike have cropped up, and of course the tax change roll out continues.
Add to that the fact the buy-to-let market was hit particularly hard by the credit crunch and has spent much of the last 10 years recovering from it and it’s not hard to see why there’s so much negativity and pessimism about where we find ourselves.
Now, I’d like to think I’ve always been a glass-half-full kind of person and, as a result, like to hear people find the positive in situations as opposed to dwelling on the negatives.
I was delighted, therefore, to read the thoughts of industry stalwart Ray Boulger recently in another industry publication. Mr Boulger spoke about how the buy-to-let market has actually benefitted from the economic crisis that brought the industry to its knees back in 2008. And he made a lot of sense.
How so exactly, I hear you ask? Well because the rates of buy to let mortgages fell dramatically following the crash, closing in on those of residential mortgages.
And I think this reminds us we should not discount the ‘good things’ happening in the market today. Indeed, even now, 10 years on from the crisis, buy-to-let rates remain highly competitive as lenders compete to attract landlords operating in a somewhat challenging landscape.
In the last few weeks alone, Sainsbury’s has cut a number of buy-to-let two-year fixed rates for remortgages. The Bank now offers rates of 1.40% (60% LTV) and 1.67% (75% LTV), both with a £1,995 product fee.
And Barclays has announced rate cuts for a number of buy-to-let products, including two-year fixes at 1.50% (60% LTV) and 1.79% (75% LTV) and five-year fixes at 2.19% (60% LTV) and 2.57% (75% LTV).
Of course, without sounding cynical it’s also worth noting that the economic crisis and the attitude of mainstream lenders towards first timers as a result led more people to rent for longer and, dare I say it, gave the private rented sector a chance to show its worth and prove its importance. And if landlords are indeed selling up at the moment, that means there are greater opportunities for the landlords that remain.
Optimism and positivity go a long way in financial services so I’m pleased to see more people talking about the positives for landlords at present. Goodness knows we’ve had enough people talking about the negatives.