The number of buy to let mortgage products available to the UK’s landlords has climbed to an all-time high, Moneyfactscompare.co.uk reveals.
It also says that the average two-year fixed rate has dipped over the past six months.
The analysis highlights a booming market, with 3,560 deals now on offer — comprising both fixed and variable options.
That’s the highest figure since records began in November 2011.
Choice of buy-to-let mortgages
The platform’s finance expert, Rachel Springall, said: “Landlords searching for a new deal will find the choice of buy-to-let mortgages has hit a record high, which could instil a sense of optimism.
“Views are mixed on how the buy to let market will fare this year, but lenders are clearly working hard to attract new business, such as those launching new deals at higher loan-to-value ratios and even deals created for a limited company.”
She adds: “Diving into the overall choice of buy-to-let mortgages shows there are still more deals with a fixed term of five years, versus two years, and both counts are at record highs.
“Five-year fixed buy to let mortgages have been in more abundance than their two-year counterparts since June 2020.”
Uptick in availability
The figures show a notable uptick in availability over the past month alone, with 92 additional five-year fixed deals and 114 two-year fixed options entering the market.
While average rates for these fixed terms edged up slightly from last month, the two-year fixed rate remains lower than it was a year ago.
For landlords with smaller deposits or limited equity, the news is equally encouraging.
Products at 80% loan-to-value have soared to 417 — a doubling of options since 2023 — providing a lifeline for those remortgaging after a two-year fixed term ends in 2025.
Rate volatility a challenge
However, Ms Springall cautions that rate volatility remains a challenge and said: “Thankfully, compared to 2023, buy to let mortgage rates are lower, across two- and five-year fixed terms.
“However, if someone locked into a cheap deal back in 2020, they will be in for a shock this year when they come to refinance.
“Landlords will hope rates come down this year, but sticky inflation can delay further base rate cuts, and the swap rate market remains unpredictable.”
Costs are squeezing landlords
Despite strong demand for rental homes due to a persistent shortage of affordable housing, rising costs are squeezing prospective landlords, Moneyfactscompare.co.uk says.
A Hamptons study recently found that landlord purchases accounted for just 9.6% of house sales in January – the lowest since records started in 2009.
Ms Springall said: “The margin of profit from rental income may well be tighter than in previous years, due to several factors, including the cull of mortgage tax relief and the expense to cover EPC requirements.
“Property is still regarded as a safe long-term investment, but both new and existing landlords would be wise to seek advice to assess the latest deals available to them and if it’s still viable to retain their portfolio.”
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