Landlords hit by higher costs as banks hike rates

Private landlords face soaring mortgage costs each year as they shoulder the burden of higher interest charges from banks. Mortgage brokers have reported a “significant increase” in buy-to-let mortgage costs since the Bank of England raised official interest rates from 0.5% to 0.75% last month. The best available two-year fixed rate has risen by 0.5 percentage points, double the increase to the Bank Rate, while the cheapest five-year fixed deal has climbed by 0.22 percentage points, according to the broker Private Finance. Chris Sykes from the company said: “While residential pricing has been rising regularly in anticipation of action from the Bank of England, buy-to-let rates have remained incredibly low. “We know some lenders are looking to grow their market share and it looked as if they were going to hold off increasing rates as long as possible. However, following the most recent rise, we have seen upward pressure on a lot of buy-to-let mortgages.” 

The Daily Telegraph (04/04/2022)