Rise in buy-to-let mortgage rates deemed unlikely

Leading economists and seasoned observers in the United Kingdom have dismissed widespread rumours that it could soon be more difficult to access buy-to-let mortgages for Britons who wished to enter the residential rental market as landlords, due to higher lending rates. A recent poll asked seven economists and industry specialists to reveal whether they believed that buy-to-let mortgage rates were set to rise later this month, due to higher inflation in the UK. According to this Adfero poll, however, all respondents indicated that a rate hike was unlikely.
Concerns about a possible rate hike have been fuelled by the fact that representatives on the Bank of England’s Monetary Policy Committee are scheduled to meet later this week and they would likely determine if there should be an increase to the base rate, which presently stands at five percent. This rate has been in force since April, when the committee actually lowered the previous figure.

While some might argue that the Adfero poll is a rather small sampling of industry experts and that it may not be fully representative of what the majority of economists think, it is important to point out that all other similar surveys conducted over the course of the past few days have arrived at a similar conclusion. Both Reuters and Bloomberg spoke with economists and the general consensus was that the buy-to-let mortgage rate would remain unchanged.

If this is indeed the case, the news will represent a very positive development for those seeking to enter the buy-to-let residential property market. If the number of private landlords continues to increase in the UK, Britons will also enjoy greater choice when looking for housing. Considering that young professionals in the UK are increasingly putting off home purchases, due to market instability, the availability of more rental properties is believed to be crucially important.

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The Residential Landlords Association (RLA) represents the interests of landlords in the private rented sector (PRS) across England and Wales. With over 23,000 subscribing members, and an additional 16,000 registered guests who engage regularly with the association, we are the leading voice of private landlords. Combined, they manage almost half a million properties.

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