So, are you getting confused about what is actually happening with the economy? I know I am! There’s so much contradictory information within the housing market being released, that no wonder both buyers and sellers are getting bemused. 

I’ve been getting more involved in residential mortgages this week and the difference in pricing in residential and buy to let mortgages really is astounding. Buy to let mortgages are almost certainly

out of favour. The lack of new lenders and new products confirm the perception from the lenders that buy to let is still more risky than residential, even when loan to values have reduced to 75% loan to value.  A fundamental shift within the mortgage market is the fact most people either can’t remortgage (due to decreasing loan to value mortgage products and decreasing property values ) or it doesn’t seem to be worth it, particularly if you are on a tracker mortgage and your rate is currently extremely low.  The key, I believe, will be how quickly rates rise, and by how much. Rates may seem nice and low but at some point keeping your mortgage rates on a tracker rate could prove risky.  So the main problem is this: by the time it is obvious that rates are increasing, fixed rates will have increased as well and so will look even worse than they are now. At some point traditional thinking may be turned on its head and you may want to consider remortgaging onto a long term fixed rate which is higher than your current rate.  This won’t save you money immediately but will give you piece of mind that for the next 5 years your rate won’t change. We will be keeping a very close eye on what lenders are doing in this area and will let you know when more fixed rates start to become available. 

Green Shoots: Just to contradict myself here’s a couple of green shoots to keep you positive (or negative, I suppose, depending on your disposition) 

1. New buyer enquiries to RICS members rose last month and the organisation believes this will translate into higher sales over the next few months
2. Clydesdale and Yorkshire report £70m profit 

Tip of the week: I’ve seen many reports this week (from clients and other brokers) that 85% buy to let is back. Well I’m afraid its a bit of a red herring. Certain lenders are advertising 85% buy to lets for existing clients and their mortgages, but these are nothing more than product transfers which have been around all the time. If it was available, after all, you would have heard it here first! An example – well if you have an existing mortgage with Natwest and it is coming to the end of its fixed rate they will allow you to transfer onto their new 85% rate.  

Website Update: Our SpytoLet mortgage sourcing system has been upgraded and has a fantastic new look. If you’ve not had a look yet or not sure what it’s all about, then here’s a recap:

1. FREE
2. Not simply a “best buy” table, but a dynamic interactive search tool specifically for buy to let mortgages
3. It can tell you the maximum loan for a particular property
4. It can tell you if you have too much or too little rent for the calculation
5. Has exclusive offers on there which are often only available through SpytoLet - so don’t miss out.

If you haven’t already registered - go and have a look in our investor zone.