BTL mortgage rate trends Q3 2012

Andy Young, chief executive of Property Hawk Mortgages comments on BTL mortgages in Q3 2012:

“In terms of the type of product that landlords are choosing, there still appears to be a clear preference for variable rates over fixed rates. During Q3 2012, 60% of buy-to-let applications received by Property Hawk Mortgages were for variable rates compared with 40% for fixed rates. The average fixed rate chosen during this period fell from 5.06% to 4.88% and the average variable rate rose from 4.10% to 4.40%.

“With variable rates still cheaper than fixed rate products, more landlords are opting for lower initial rates, which may reflect a growing consensus that interest rates will continue to remain low for some time to come. The increase in the average variable rate can be attributed to the availability of higher LTV products which are also priced higher."

“In terms of the split between purchases and remortgages, it was absolutely even during Q3 with 50% of applications received for each type. This demonstrates the keen appetite amongst landlords looking to take advantage of the excellent remortgage deals available to release equity from their existing properties, and those looking to expand their portfolios with the purchase of additional properties."

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