Landlords spoilt for choice with mortgage products

The number of mortgages available to landlords has passed the 2,000 mark for the first time, new figures have revealed.

It’s a welcome piece of positive news for landlords, who have faced tax changes, new regulations and a heap of uncertainty in the buy-to-let market.

There are now 2,022 mortgage products available to landlords, compared to 1,340 two years ago, according to the research carried out by financial group Moneyfacts.

Greater choice for landlords

The uptick in the number of mortgage options out there means greater choice for landlords. With different landlords having different financial needs, the freedom to chose from a variety of deals is really valuable.

Charlotte Nelson, Moneyfacts finance expert, said: “The buy-to-let market has seen quite a rollercoaster in the past year, including multiple changes that have required both landlords and providers to rethink their options.

“However, this hasn’t appeared to deter providers, marking an increase of 464 deals in one year, which has seen the buy-to-let market break yet another record and rise past the 2,000 mark for the first time on our records.”

Moneyfacts suggested that the official Prudential Authority rules launched at the end of September 2017 requiring lenders to apply stricter standards to those with four or more properties could explain the increase in product numbers.

It follows Moneyfacts reporting that the number of limited company fixed-rate options are on the rise. These extra products catering for landlords reassessing their options following the reduction in tax relief are another reason why the overall product numbers have risen.

Buy-to-let lenders competing for customers as landlords reassess

Ms Nelson added: “Amid this upheaval, the market has seen many landlords and aspiring landlords take a step back to assess their options and figure out whether they are making the right choice. As a result, buy-to-let providers are now competing for customers - and offering a variety in their range is one way in which they can compete.

“While it has been a tough time for the buy-to-let market, the fact that the number of available deals is still growing shows it is still a viable option.”

Commenting on the findings, Chris Maggs, of lender Accord, said that making significant income from buy-to-let is more challenging due to the changes in taxation impacting landlords.

But he added: “Providing a landlord is investing for the long-term in bricks and mortar they may well still be the best place to invest. The capital growth potential remains providing an excellent long-term investment.”

He explained: “Without a doubt the buy-to-let sector if far more challenging than a few years ago. Lenders’ criteria has rightly been strengthened in the interest of the customer to ensure affordability is met. However, the buy-to-let market is very much alive.”

Get set with tailored landlord cover

Over 200,000 UK landlord policies, a 9/10 customer rating and claims handled by an award-winning team. Looking to switch or start a new policy? Run a quick landlord insurance quote today.

Start your quote