BTL product numbers at 12 year high


The latest data released by Moneyfacts has revealed that the number of buy-to-let products available on the market has risen to the highest figure seen since the start of the financial crisis in 2007.

According to the figures, 2,396 BTL products are now available, increasing by 21% since June 2018.

Meanwhile, average buy-to-let mortgage rates have also risen over the past 12 months, with the average two-year fixed rate increasing by 0.17% from 2.88% in June 2018 to 3.05% and the average five-year rate rising by 0.11% to 3.54%.

Both rates still stand significantly lower than in October 2007 however, when the average two-year buy-to-let fixed rate stood at 6.36% while its five-year counterpart stood at 6.39%.

Darren Cook, finance expert at Moneyfacts, said: “The buy-to-let market has experienced a number of regulatory changes during recent years, however, it seems that product competition within this specialised mortgage area is continuing to grow. A 21% increase in availability to 2,396 products over the past 12 months indicates that providers are keen to offer potential buy-to-let investors plenty of choice within the sector.

Despite this increasing competition in terms of the total number of products available over the past year, average rates have unfortunately not fallen, and have instead followed suit, with the average two-year fixed rate increasing by 0.17% to 3.05% and the average five-year fixed rate increasing by 0.11% to 3.54% over the same period.

The largest concentration of buy-to-let product choice can be found at the maximum 75% LTV tier, where there are currently 352 (44%) two-year fixed rate products available and 374 (48%) five-year fixed rate products available. Coincidently, the average fixed rates at the 75% LTV tier for the two and five-year sectors are currently 3.05% and 3.55% respectively, equalling or near-equalling the average rates for both terms across all tiers.

The increase in the buy-to-let average rates contrasts with the downward trajectory of their residential mortgage counterparts, where product competition seems to have instead resulted in rates falling. This disparity in trends is likely to be attributed to the different approach lenders take to risk between these two sectors, and that economic uncertainty may be having a more adverse influence on the buy-to-let mortgage market than it is having on the residential mortgage market.”


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