Rightmove’s daily Buy To Let mortgage tracker shows how rates have increased since the start of the war in Iran, increasing cost pressures for landlords.
While it’s early days and there’s no clear signs as yet, higher mortgage costs could impact new investment in the future.
The average two‑year buy‑to‑let mortgage rate for a landlord purchasing a rental property with a 25% deposit is now 5.79%, up from 4.86% before the war in Iran started.
Rightmove’s property expert Colleen Babcock says: “Rents holding steady this quarter reflects how affordability remains stretched, but also how supply and demand is more balanced.
“With more homes available to rent and less competition between tenants, landlords are needing to position rents correctly for the current market to secure a tenant.
“As market conditions rebalance, homes are taking longer to let.
“The market is more price sensitive, with landlords needing to be realistic from the outset to secure a tenant and reduce the risk of void periods.
“Around 26% of rental listings are now reduced in price while advertised, the highest proportion recorded since Rightmove began tracking this metric in 2012.
“Ahead of the Renters Rights Act coming into force, the data doesn’t suggest a single or immediate reaction from landlords.
“Instead, behaviour appears more cautious and considered, with many focusing on long‑term tenancies, pricing and avoiding void periods in a more balanced market.
“It’s still early days, but the most immediate shift due to the war in Iran has been some significant increases to borrowing costs for landlords, which may filter through to the market at a later stage.”