Buy-to-let mortgages 'becoming more competitive'

by Sarah Ashcroft

Buy-to let mortgage deals are becoming increasingly competitive from building societies looking to attract more landlords to their products, as the current economic climate continues to affect the property market.

This is according to Lee Grandin, director at Landlord Mortgages, who said major companies - including Principality and Coventry Building Society - are introducing better deals in order to encourage proprietors to engage with the industry.

The expert went on to note while taking out a buy-to-let mortgage can be a time-consuming process, it is also likely to take a "good few months" for firms to bring in a significant improvement in rates.

He also claimed there has not been much of an upturn in the number of landlords applying for a deal, with many companies introducing cheaper offers recently in an attempt to maintain levels of business.

Mr Grandin's comments were made after Leeds Building Society announced it had reduced the rate on its two-year fixed-rate buy-to-let mortgage by 0.36 per cent to a new market leading figure of 3.99 per cent.

The company's sales and marketing director Kim Rebecchi said now is a "very good time" to look out for a low fixed rate, as the provider aims to attract professional landlords who may wish to fix their monthly commitments.

Meanwhile, Mr Grandin went on to say a reduction to rates may not have a significant impact on the market at the moment due to the economic situation, but nevertheless it may have positive implications in the long term.

"I don't know if it is because [mortgage providers] have a volume of business and want a higher volume of business, or if it is just that they need to try and stimulate things a bit. I think it is probably more the case that the market is still quite subdued," he explained.

Published on: July 31, 2012

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