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Is Buy to Let still a good investment and are Buy to Let mortgages still worth it?

It’s been 25 years since Buy to Let mortgages first came on the market. Originally launched in September 1996, these mortgages were introduced to help with the 90s housing market slump. Prior to this, it was difficult for mortgaged properties to be rented out.

According to HMRC data*, there are now a huge 2.65 million Buy to Let landlords in the UK. But, with changes to Stamp Duty tax and increasing legislation, is Buy to Let still a good investment? And are Buy to let Mortgages still worth it?

Below we discuss some of the benefits associated with a Buy to Let investment:

Wide range of Buy to Let mortgage products

According to latest data from Moneyfacts**, the availability of Buy to Let mortgages has increased to a 14 year high. This means that the number of mortgage products available have reached pre pandemic levels.

This increased choice means that there is not only more choice for landlords. But also, a great deal of competition among mortgage lenders to win new Buy to Let mortgage customers. Ultimately, the lenders want your business.

Low rates on Landlord products

Added to the range of products available, mortgage rates are also at record lows according to Moneyfacts**. The average overall two and five year rates reduced in September. And, in the same month, the two year and five year fixed rates were the lowest they’ve been this year.

This means that, if you’re looking to take out a Buy to Let mortgage the rates will be highly competitive.

Rents are increasing year on year

According to Showbrook Bank*** rents have increased across the UK by 1.6% year on year. In fact, the South West – where Your Mortgage Expert is based – has seen growth of more than 2%.

As rental demand remains high, Buy to Let could be a worthwhile investment and the rise in overall product choice and fall in average rates is positive. It is therefore no surprise that research by Shawbrook Bank*** has found that a third of landlords are looking to expand their property portfolios in the next 12 months.

If you’re thinking of investing in a Buy to Let property, it’s important to do your research first. Not only do you need to think about whether you can afford to purchase the Buy to Let Mortgage repayments. You also need to think about the fees and costs associated with purchasing a property to rent out. Things like Stamp Duty Tax, Application fees, Arrangement fees, legal fees and insurances can all eat into your investment.

How can Your Mortgage Expert help?

We understand that no two mortgages are the same and our knowledge and experience means we’re in a great position to help. It’s advisable to sit down and run through your finances so that you can compare the cost you’re going to pay for the property, against the rent you’re likely to take in from the tenants. A mortgage adviser could talk you through this so you have a clear idea of whether you can comfortably afford the mortgage on your own.

When you’re ready to apply for your mortgage, our specialist Buy to Let mortgage advisers will be able to arrange an appointment that easily fits around you, whether that’s face to face or over the phone.

Searching the market yourself can be time-consuming. But with our help, we can search thousands of mortgages, including exclusive deals and lenders that you wouldn’t otherwise have access to. We have regular contact with a wide range of lenders, some of whom you may not even know exist! With our help, you won’t have to search or contact each individual lender in order to compare the mortgage terms and rates; we’ll do all that for you.

Contact us to find out more about how we can help. We don’t charge for an initial consultation, so by speaking with us for mortgage advice, you won’t be under any obligation.

The information contained within this article was correct at the time of publication. It is intended for information only and does not constitute advice. Your Mortgage Expert Ltd and Mortgage Advice Bureau cannot be held responsible for information that was correct at the time of publication but subsequently changes or goes out of date due to changes in legislation.

*Source: https://www.buyassociation.co.uk/2021/09/28/buy-to-let-remains-attractive-investment-option-to-most-landlords/

**Source https://www.whatmortgage.co.uk/news/buy-to-let/buy-to-let-mortgage-choice-exceeds-pre-pandemic-level/

***Source : https://www.which.co.uk/news/2021/09/buy-to-let-market-on-the-rise-is-now-the-time-to-invest/

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