Mortgage costs in the buy-to-let (BTL) market have continued to fall over the last three months, according to Mortgage Brain.
Its quarterly product data analysis revealed that these figures reflect the 2019 trend of a continued decrease in costs for the majority of BTL mortgages.
For example, the cost of a 60% loan-to-value (LTV) two-year fixed is now 1.7% lower than it was 12 months ago, representing an annual saving of £126 on a £150,000 mortgage.
Rates also remain low on a 70% LTV two-year tracker, with no considerable change over the last three months.
However, costs are 4% lower than 12 months ago, equivalent to an annual saving of £324 on a £150,000 mortgage.
The data shows that the greatest reductions in savings rates are on longer-term fixed mortgages, meaning borrowers can benefit from better annualised savings.
A 70% LTV five-year fixed, for example, is now 1.8% lower compared to three months ago and 4.4% lower than a year ago. This equates to a yearly saving of £144 and £360 respectively, on a typical l£150,000 average.
BTL versus residential
Mortgage Brain’s analysis also revealed the differences between BTL mortgages when compared to mainstream residential products, with the cost of BTL mortgages higher.
The data (from December 1 2019) found that the cost of a 89% LTV two-year fixed product is almost 30% higher than the same product for a residential mortgage and 18% higher for a five-year fixed product.
“Our latest BTL quarterly analysis shows some cost reductions over the last three months,” Mark Lofthouse, chief executive officer of Mortgage Brain, comments.
“When viewed over the course of 2019, they show that there has been a continuous reduction in rates resulting in substantial price reductions particularly for five-year fixed rate products.”
“With specialist advice and support from brokers, landlords can continue to make the most of the low rates and be confident they are getting the best mortgage to suit their needs.”