Buy-to-let mortgage rates still rising but product choice expands

This is according to the latest data from Moneyfacts.co.uk, which revealed mortgage product choice for landlords was recovering following the recent turmoil with over 700 buy-to-let mortgages appearing since the start of October.

Whilst figures are not quite up the levels seen in September when there were over 2,000 deals in the buy-to-let market, the rise to 1,769 from 988 on 1 October is being seen as encouraging for landlords.

This is despite the fact interest rates on fixed-rate deals have risen over the same period. Moneyfacts’ figures showed the overall average buy-to-let fixed rates across both two- and five-year terms is now over 6%.

Rachel Springall, finance expert at Moneyfacts.co.uk, said: “Landlords will be paying higher interest rates than if they secured a deal just eight weeks ago.”

She added: “There are high expectations that interest rates will come down in the weeks ahead, so it would not be too surprising if landlords wait a little longer before they refinance, particularly as we approach the end of the year.”

How will rising mortgage rates impact rent

Rachel also offered advice to landlords who were concerned about profit margins because of rising interest rates and the cost-of-living crisis.

She said: “Any investor will need to carefully balance their rental expectations amid rising costs as it is difficult to tell how investors could be impacted moving into 2023.

“However, since January 2020, rents have risen 19% across Great Britain, equating to an extra £2,351 a year for tenants, according to a study by Hamptons.

“It’s essential any potential borrower seeks independent financial advice before entering any arrangement to ensure it’s the right choice for them.”