Whatโs happening in the mortgage marketโฆ With the mortgage market in flux and the newspapers full of doom and gloom, I thought Iโd provide...
Whatโs happening in the mortgage marketโฆ
With the mortgage market in flux and the newspapers full of doom and gloom, I thought Iโd provide a buy-to-let update for you since the difference between reality and headlines is often different.
So where are we, the current bank of England base rate is 2.25%, it was 0.1% in December 2021 and we have two more rate-setting meetings this year, the next of which is 3rd November 2022.
The conversations are that mortgages are currently averaging 6% but as you can see floating rates are a long way from this. I asked our mortgage broker, Gary, to provide a breakdown of the current rates available to provide an insight into where we are and what rates you can get if youโre looking to re-mortgage.
Mortgages in your Personal Name
- The best 2-year fixed are 4.74% for smaller landlords or 5.54% for portfolio landlords
- 5-year fixed start from 5.39% for smaller landlords and 5.54% for portfolio landlords
Limited Company Mortgages
- 2-year fixed starting from 5.89% and 5-year fixed from 6.24%
The buy-to-let mortgage remains firmly open even with all the market swings weโre currently having.
So the big question is what will happen to property prices โ thatโs the million-dollar question, right?
The one thing I would say is if house prices go down by 15%, with inflation at 10%, thatโs an effective real terms swing in prices of 25%. I personally canโt see the market declining to such a large extent with the availability of credit from banks (who still want to lend). I think the likely scenario is for house prices to remain static when taking into account inflation of 10% or earnings of 5%+, which will mean a decline in real terms.
This government, although inconsistent, certainly wants to be re-elected. The best way to do this is to pump the housing market (hence the stamp duty cut) so theyโll do whatever they can to keep the housing market healthy โ so watch this space.
I hope this helps and let me know if you need any help with re-mortgaging to try and reduce this cost for you!
Remember itโs our job to generate you long-term wealth from property!
For any sales, lettings or refurb help:
- Contact us today by phone or email to move your property to us.
- Weโll contact your letting agent to ensure a seamless tenant transfer, including the deposit, keys and all paperwork.
- Weโll contact your tenant to resolve any rent, maintenance or refurbishment issues you have, arranging a property visit if required.
- Weโll begin the process of maximising your income and wealth.
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