The number of buy-to-let mortgage products increased in June after dropping throughout the lockdown, shows data from Moneyfacts.
At the start of March this year there were 2,583 BTL products for landlords to choose from. This fell to 1,455 by the start of May, and now, as of 1 July, stands at 1,738, an increase of 283.
Moneyfacts shows that the biggest increase from May in terms of actual numbers are two-year fixes at 80 per cent LTV, where product choice has increased from 9 to 31, growth of 22 products.
The number of five-year fixes at 80 per cent LTV house the second-largest increase, from 6 to 19 – 13 more options for landlords.
Overall, there are 134 more two-year fixes and 164 more five-year fixes on the market across all LTVs, numbering 625 and 644, respectively.
At 60 per cent LTV, the number of two-year fixes fell from 148 to 144 and for five-year fixes, from 155 to 146.
“[This] could be explained by the fact that lenders may have increased any maximum LTV caps that they put in place earlier this year, as the number of products live in the next LTV categories (65 per cent, 70 per cent and 75 per cent) have all increased. This is a further indication of an appetite to lend from providers in this sector,” says Moneyfacts finance expert Eleanor Williams.
Meanwhile, average rates across all LTVs have crept up slowly. The average rate for a two-year fix at all LTVs was 2.51 per cent at the start of May and now comes in at 2.61 per cent, while the average rate for a five-year fix at all LTVs stood at 2.94 per cent in May and is now 2.97 per cent.
However, at 80 per cent LTV for a two-year fix, the average rate has dropped from 3.61 per cent to 3.18 per cent and for a five-year fix at 80 per cent LTV, from 4.32 per cent to 3.82 per cent.
Williams adds: “The latest rental index research from lettings platform Goodlord indicates that in June, new tenancy applications remained at 90 per cent above 2019 levels.
“Subsequently, they have recorded increases in rental costs and also void periods reducing, as tenant demand for new properties remains strong now that the market has reopened. This news should be a boost to landlords, who after a difficult few months can see that choice is beginning to return to their sector.
“The increase in overall product choice and the fact that average rates remain competitive when compared to where we began this year may be early indications that this sector is starting to recover.
“Due to continuing economic uncertainty and few low-deposit residential mortgage deals available, there may be increased demand for private rental properties, which those landlords in a position to capitalise on may wish to consider.”
