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By Spencer Gordon, Jan 20 2016 01:16PM

The governor of the Bank of England has booted an interest rate rise into the long grass and beyond and this will further drive demand for mortgages throughout 2016, affirms the boss of deVere Mortgages.

The comments come as Mark Carney in a speech on Tuesday confirmed that there would be no immediate interest rate rise due to an “unforgiving” global economy and weaker growth in the UK.

Mike Coady, Managing Director of deVere Mortgages, observes: “The collapse of oil prices, weak economic performance in China, and the slow down in UK wages and growth, have made their mark on the Bank of England’s decision.

Bearing in mind these serious concerns that won’t be resolved overnight, noting the language used by the governor in his statement, plus the fact that the MPC have voted to hold rates by 8 to1 means, I believe, that the first rate rise has been booted into the long grass – and beyond.

There always seems to be a stream of important reasons for the Bank to keep the rate unchanged.

Mr Coady continues: “I think the earliest we can now expect a rate rise will be in 2017. This is primarily because headline CPI inflation is almost back to zero and because whilst UK GDP growth is steady, current forecasts for wage growth in 2016 of 3.75 per cent look very optimistic. And when interest rates do eventually rise, there is little reason to expect a return to the rate levels of before the credit crunch.

The justified expectation that ultra low interest rates are the new normal and the view that generally house prices across the UK are correctly priced in the current low interest rate environment, will fuel mortgage applications throughout 2016 and for the next few years at least.”

By Spencer Gordon, Feb 11 2015 10:14AM

The sudden plunge in mainstream mortgage rates - which has seen a number of lenders offer 10-year fixed rate loans at less than 3pc, and sparked a widespread "rate war" - is spreading to buy-to-let.

Specialist landlord broker Mortgages for Business said there were now more than 800 buy-to-let loans available, a number that has grown by more than 100 in three months.

As in the owner-occupier market, borrowers with bigger deposits fare best, but borrowing costs are falling for almost all categories of landlord.

A 40pc deposit and good credit history could garner a landlord a market-leading five-year deal at 4.2pc.

The best two-year landlord loans charge around 3.5pc.

These are substantially lower than even six months ago. Brokers point out that with rents remaining stable or rising, these new, lower-rate mortgage deals offer landlords the opportunity to boost returns.

Moneyfacts, the rates analyst, said the average of all fixed rate loans currently available was now just 3.82pc, which it claims is the lowest it has ever recorded. Variable-rate buy-to-let loans average 3.6pc (see graph, below).

It is also becoming easier to obtain loans with smaller deposits, and lenders are looking more kindly on landlords wanting to refurbish properties or what want to buy properties to let to multiple tenants as HMOs or "houses of multiple occupation".

Sylvia Waycot of Moneyfacts said: “When you consider dire savings rates, it is hardly surprising that buy-to-let is proving popular with investors, and this is likely to increase once new pension rules come into force in April.

"Having had several years of the bank door being firmly shut to only the richest of borrowers, doors appear to not only be open but actively entice you in off the street with offers of fantastic rates.”

Lenders do still apply strict lending limits based around the number of properties a landlord owns, the level of rent they generate and in some cases landlords' other sources of income.

Mark Harris of mortgage broker SPF Private Clients said: "With lenders aggressively competing for business, there are more buy-to-let mortgages available with increasingly relaxed criteria and lower rates - all providing a further boost to an already-popular sector.

"The best rates remain available to those with the biggest deposits, while landlords are increasingly opting for fixed-rate mortgages to provide more certainty and help with budgeting.

"While it is easier to get into buy-to-let now then it was five years ago, it is still harder than it was before the downturn. Lenders have learnt their lesson and are being more cautious."


If you are interested in discussing anything to do with Buy to Let investing then please call into to our office at Spencer Gordon 4 Post Office Avenue, Southport or call 01704 460 160.

Spencer Gordon Estate Agents Southport


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