Residential And Buy-To-Let Mortgage Rates Reducing

Buyers within both the residential and buy-to-let sector have enjoyed a range of new products and reduced rates on existing products in recent months.

Within the past week, mortgage lender, Barclays, have released eight new products and reduced their mortgage rates as lenders look to ignite the property market once again.

The product in Barclays range that has offered the best reduction in residential mortgages concerns the LTV five-year fix. This has reduced from 2.32% to 2.14%; a saving of 0.18% overall.

Similarly, buy-to-let investors can also enjoy savings of 0.27% in the mortgage customer reward range with the 75% five-year fix.

These savings seem to correlate with Property Master’s mortgage tracker findings on buy-to-let mortgage deals.

According to the figures, buy-to-let mortgages for an interest only loan of £150,000 are down on the same statistics from a year earlier.

Investors with five-year fixed rate offers for 75% of the value of a property are, on average, making a saving of £21 per month when compared with January’s figures last year. This would mean that investors can make annual savings of over £250.

With interest rates predicted to rise at some point this year, locking in deals like this could mean that consumers are set to start their year extremely happily.

Craig Calder, Barclays Mortgages director, said: “We are really excited about the great opportunities of the mortgage market in early 2019.

“We expect the remortgage market to be particularly vibrant as many customers will be looking to get their finances in order following the holiday period, so in addition to a host of reductions across our existing rates, we are delighted to confirm the launch of a new product which comes with £500 cashback.”

Angus Stewart, Property Master’s chief executive, commented: “Whilst interest rate prediction given the uncertainty around Brexit is very difficult indeed, the Bank of England has given a clear signal that rates must rise at some point and most commentators are expecting this to happen in the coming year.

“The current low rates, particularly for five-year fixed mortgage products, suggest that landlords should give serious consideration to remortgaging now to minimise the rate uncertainty that Brexit might bring.”

Whilst property sales and prices began to fall in the last quarter of 2018, some building firms have prospered, in part, due to favourable mortgage rates.

Housebuilder Taylor Wimpey have enjoyed sales volumes rise by 3% to 14,947 and forward orders rise by 9% to £1.78 billion. Share prices also increased by 4%, rising from 140.4p per share to 145.75p.

Peter Redfern, chief executive of Taylor Wimpey, said: “People look at these big political situations and at first they’re nervous but after a while, they tend to want to get on with life. The biggest concern for us would have been mortgage rates rising, but the thing that has surprised us in the last few months is rates have come down.”

Could cheaper mortgage and remortgage rates encourage potential buyers to purchase property despite Brexit causing uncertainty?

Today's Conveyancer