Big building society follows other BTL lenders and cuts rates

The mortgage market has seen a flurry of activity in recent weeks, with several major buy-to-let (BTL) lenders reducing their interest rates following the Bank of England’s decision to cut the base rate from 5.25% to 5%. The latest lender to join the ranks is Leeds Building Society, which has announced reductions to its BTL mortgage products.

BTL mortgage market heats up as rates tumble

According to data from Mortgage Finance Business (MFB), 75% LTV two and five-year fixed rates for individuals now start from 3.59% and 3.84% respectively, with a reasonable 3% arrangement fee. For limited companies, rates start from 4.79% and 4.99% with a 3% arrangement fee. However, investors can access lower interest rates if they are willing to pay a higher arrangement fee of 5-7%.

“Reductions are still modest, but rather than most rates starting with a 6 as we had a year ago, seeing more in the 3-4% range is really encouraging,” says Gavin Richardson, MD of Leeds Building Society. “SWAP rates still indicate that interest rates will continue to decrease slowly over the remainder of the year. Although these reductions will be small, they will significantly impact how much you spend over the life of a mortgage.”

“Confidence cannot be found in economic factors but more how you can leverage the turmoil in the money markets to buy at under market value.” - Lee Grandin, Landlord Mortgages

The BTL mortgage market has seen significant changes in recent years, with many lenders tightening their criteria and increasing interest rates in response to economic uncertainty. However, the latest rate reductions suggest that lenders are now more confident in the market and are willing to offer more competitive deals to investors.

BTL market starts to heat up as lenders reduce rates

Despite the positive news, some experts are warning that investors should not get too carried away with the rate reductions. Lee Grandin, of Landlord Mortgages, says that the fight against inflation is far from over and that investors should focus on finding good value in the market rather than relying on low interest rates.

“A bargain is a bargain in any market - you just need to know what a bargain is in the first place and that is the key to any investment whether stocks and shares or property,” he says.

The rate reductions are likely to be welcomed by BTL investors, who have been facing challenging market conditions in recent years. With house prices starting to increase, now may be a good time for investors to consider new investments. However, as with any investment, it’s essential to do your research and carefully consider your options before making a decision.

Mortgage rates set to continue downward trend

Overall, the latest rate reductions from Leeds Building Society and other lenders are a positive development for the BTL mortgage market. While the reductions may be modest, they are a sign that lenders are becoming more confident in the market and are willing to offer more competitive deals to investors. As with any investment, it’s essential to do your research and carefully consider your options before making a decision.