Buy to let mortgage costs are drifting upwards says broker

A specialist broker says the costs of most fixed rate buy to let mortgages are beginning to rise. 

Property Master warned last month this was likely following the decision by the Bank of England to revise upwards its forecasts for growth in the UK economy; it now says this has been widely seen as the Bank positioning itself for more increases in base rate than the financial markets had previously been forecasting.

Five-year fixed rates for 65 per cent of the value of a property have now increased month on month by £5.  

Five-year fixed rates buy-to-let mortgage offers for 75 per cent of the value of a property was the only one of six categories tracked to fall in monthly cost but then only by £1.  

The three categories of two-year fixed rate buy-to-let mortgages tracked all increased with the largest rise being £6 per month.

Property Master tracks a range of buy to let mortgages for an interest only loan of £150,000.  

“There is some comfort for landlords facing increased rates in that competition amongst mortgage lenders for business has been fierce in recent years and that has fuelled the growth in the number of buy to let mortgage offerings to a 10 year high” explains Angus Stewart, Property Master’s chief executive.

“There are an estimated more than 2,100 products to choose from but with lending criteria varying considerably between the operators landlords cannot assume that all of these possibilities are open to them.”