Despite recent news stories around landlords mass-exiting the BTL market as a result of changes to mortgage interest tax relief and other legislation that is set to eat in to investors’ profits, “it’s not all doom and gloom in the buy to let sector” – so says Steve Bradley, Managing Director of property insurance specialists UKinsuranceNET.
He explains: “Buy to let mortgage lenders are supporting investors by offering some attractive mortgage and remortgage deals. There are some great deals floating around at the moment, which certainly doesn’t suggest that the sector is going under.
“For example, the Leeds Building Society has launched a five-year fixed rate buy-to-let mortgage at 3.10% up to 70% LTV. Accord Buy to Let has made 0.20% reductions on selected buy-to-let remortgage products with rates now starting at 1.76%, for a two-year fixed rate remortgage loan at 75% LTV.
“And in April, The Family Building Society launched a BTL offset mortgage, which allows private landlords to use their savings to cut their tax bill. As landlords can put spare cash into an account which is offset against the mortgage balance to reduce the interest due – thereby cutting their costs.”
Mr. Bradley adds that the “mass-exit” of landlords from the BTL sector isn’t reflected in the number of landlords cancelling their landlord’s insurance policies with UKinsuranceNET. “We do not appear to have many of our landlord insurance policyholders requesting cancellation of their policies, so part of me thinks all the negative media is a bit out of proportion – in my opinion the sector certainly isn’t doomed. Investors are a savvy lot and will find ways to minimise their costs by switching mortgages, incorporating and generally giving their financial position a review”.
