Despite the challenges faced by the buy to let sector, mortgage companies are fighting hard for business – and two and three year fixed rate products are now at record low costs.
Mortgages for Business, which monitors the sector, says the average pricing of two- and three-year fixed rates is at an all-time low, at 2.92 per cent and 3.76 per cent respectively.
But the firm insists that while this is good for landlords who are happy to use shorter term products, those wishing to lock into record low rates for the longer term must act quickly.
Five-year fixed rates crept up for the second month in a row and now average 3.77 per cent, exceeding the average price of three-year fixed rates for the first time since January 2015.
“It’s no surprise that pricing for five year fixed rates have started to creep up. However, these rates are still, on average, less than one per cent more than their shorter term counterparts” explaints Mortgages for Business chief executive David Whittaker.
“At the very least, landlords should consider having some properties mortgaged on longer term fixes to spread risk. The fact that these rates are beginning to rise now should prompt landlords to take action sooner rather than later” he adds.
Mortgages for Business also found that January was a good month for short-term tracker products, with two-year buy to let tracker rates again at an average of 2.81 per cent, having remained unchanged from December.