As a buy to let landlord, staying informed on market trends is key to making smart investment decisions. In this week’s update, we’re diving into the latest data from Halifax and Rightmove, covering everything from house price movements to rental market pressures and landlord sentiment.
SWAP Rates Ease Slightly, Offering Some Relief
SWAP rates have eased slightly this week, offering a modest but welcome sign of stability for mortgage borrowers. Two-year SWAPs are currently sitting at 3.64%, unchanged from one month ago and slightly lower than the 3.84% recorded this time last year. Meanwhile, five-year SWAPs are at 3.69%, almost identical to last month’s 3.68%, though still slightly higher than the 3.49% seen a year ago.
While these movements are relatively small, they’re significant in the context of recent volatility. The slight dip in SWAP rates could give lenders room to reduce pricing again, especially after a round of recent increases. However, due to the operational complexity of repricing, many lenders may wait for more sustained stability before making further changes.
For landlords considering refinancing or purchasing, this could be a good time to secure a rate and monitor the market closely for any downward shifts.
Lender Pricing Updates: Small Increases, Big Implications
Several lenders have nudged up their mortgage pricing following last week’s slight rise in SWAP rates. While the increases are modest, typically between 0.05% and 0.19%, they’re worth noting for landlords considering new financing.
Lenders such as TMW, BM, Nottingham, Virgin Money, Santander, and Accord have all made adjustments. These changes are directly linked to SWAP rate movements and may be reversed if rates continue to ease. However, lenders tend to move cautiously, as repricing involves multiple departments.
If you’ve already submitted a mortgage application, remember that many lenders allow you to switch to a lower rate if pricing drops before completion, often at no cost. So, securing a rate now and monitoring lender updates is a smart move.
Find your next BTL mortgage rate here >>
Lender Criteria Changes: More Flexibility for Portfolio Landlords
United Trust Bank (UTB) has made notable changes to its lending criteria that could benefit landlords with larger or more complex portfolios. While UTB may not be a household name in the buy to let space, they’ve been active in development and bridging finance for years and are now expanding their reach.
Key updates include:
- Unlimited background portfolios: UTB no longer restricts how many properties you own in the background, making them a viable option for seasoned landlords.
- Maximum lending increased to £2.5 million: Previously capped at £1.5 million, this change signals UTB’s intent to support larger investments.
- Flexible property types: UTB takes a common-sense approach to properties that other lenders might reject due to construction type or location.
While they’ll only lend on up to six properties at a time, their relaxed stance on background portfolios and property types makes them a strong contender for landlords with more niche or expansive portfolios.
House Prices Edge Up Again
According to Halifax, UK house prices rose by 0.3% in August, marking the third consecutive month of growth. The average property value now stands at £299,331, a new record high. While annual growth has slowed to 2.2%, the upward trend is encouraging for landlords looking to build equity.
First-time buyers saw some relief, with average prices for this group falling by 6% since May. The average first-time buyer property now costs £237,577. For those able to save a deposit, monthly mortgage payments on a 95% LTV mortgage over 30 years are estimated at £1,179, lower than the average private rent of £1,343.
Regional Price Trends
Northern Ireland continues to lead the way with an annual growth of 8.1%, followed by Scotland at 4.9%. Wales saw a modest 1.6% increase, while parts of England, such as the North East, North West, and Yorkshire & the Humber, posted growth above 4%.
However, the South West experienced an 8% annual decline, the first region to do so since Eastern England in mid-2024. London remains the most expensive region, with average values up 8% year-on-year to £541,615.
Rental Market Snapshot: Supply Still Tight
Rightmove’s Lettings in Focus report paints a clear picture: advertised rents across Great Britain hit a new high of £1,577 per calendar month in August, up 3% year-on-year. This rise is driven by constrained supply, with rental stock still 27% below pre-pandemic levels.
While rental supply has improved slightly, up 8% compared to last year, it’s not enough to meet demand. Regionally, the North West saw the fastest rent increases at 10%, while London’s growth slowed to 2% after a strong run earlier in the year.
Find your next BTL mortgage rate here >>
Landlord Sentiment & Taxation Concerns
The looming implementation of the Renters’ Reform Bill and potential changes to landlord taxation (including national insurance on rental income) continue to cause concern. Rightmove’s survey found:
- 1 in 3 landlords are considering exiting the market
- 66% feel unsupported by the government
- 68% are frustrated by ongoing regulatory changes
Despite this, 51% plan to maintain their portfolio size over the next year, and 1 in 5 are looking to expand, a sign that many landlords still see opportunity in the current climate.
Final Thoughts
While regulatory pressures remain, the fundamentals of the UK property market, rising house prices, strong rental demand, and limited supply, continue to support landlord investment. If you’re considering expanding your portfolio or refinancing, now’s a good time to review your options.
Next Steps
For tailored advice on buy to let mortgages, get in touch with our expert team.
Call us on 0345 345 6788 or submit and enquiry here and one of our team will call you back.
