Buy-to-Let Borrowing Costs at Three-Year Low

Recent data indicates that buy-to-let mortgage borrowing costs in the UK have dropped to their lowest point in three years, which could bring welcome relief for landlords and investors around Hampshire, Surrey and the surrounding regions.

What’s changing?

According to the Financial Times, two-year fixed buy-to-let rates are now at roughly 4.88%, and five-year fixed at 5.21%. These are the lowest we’ve seen in some time.

More buy-to-let mortgage products are being offered by lenders, increasing competition and choice, which is great news if you’re a landlord looking for investment property.

Why does this matter?

• Local landlords can benefit from lower interest expenses, making investment more viable or improving yield.
• Tenants may see more availability of rental properties as landlords feel more able to acquire or keep letting properties.
• For sellers of buy-to-let properties, the market may become more active, potentially improving demand.

Risks and Considerations

• Lower interest rates do help, whilst other costs remain, including: maintenance, property taxes and regulations.
• Regulations in the rental sector are evolving: new landlord obligations are being discussed (e.g. around tenants’ rights) which could affect profitability.
• Interest rates may not stay low forever—market pressures, inflation etc. could force changes, so it’s best to take action now.

Mackenzie Smith: How we can help.

Here at Mackenzie Smith, we keep close tabs on mortgage streams for landlords, ensuring that people we work with are aware of the best current deals.

Whether you’re considering letting out a property or investing, we can help you assess your circumstances, and refer you to independent mortgage advisors with the experience you need to attain the best possible deal.

If you want to explore buy-to-let options, our residential and lettings’ teams can provide a seamlessly integrated service to meet your needs, so please feel free to reach out to your nearest branch.

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