Best Buy to Let mortgage rates – April 2024

What’s happening with Buy to Let mortgage rates?

So what’s happening with the best Buy to Let mortgage rates in the UK in April 2024? The best Buy to Let mortgage rates available this month remain largely the same as last month. But noone knows what’s going to happen to mortgage rates in the future. Also, if you’re looking for a new deal, your new mortgage deal may be much more expensive than your old one. So it’s vital to shop around for the best Buy to Let mortgage rates.

And if you’re a landlord on a variable rate Buy to Let mortgage, you will have seen payments increase over the last year with each base rate hike. So again, it’s a good idea to take stock.

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Compare the best Buy to Let mortgage rates in April 2024

Looking at average rates can give you a general idea of what’s happening in the market, but in order to crunch the numbers you’ll want to find the cheapest deal available. That’s where this page comes in handy. Updated regularly, it sets out the best Buy to Let mortgage rates now so you can compare what’s out there.

2 year fix: Best Buy to Let mortgage rates

LTV	Lender	Initial rate	Fees
65%	The Mortgage Works	3.69%	£3,280
75%	The Mortgage Works	3.79%	£3,280
55%	Landbay	3.84%	£6,484

5 year fix: Best Buy to Let mortgage rates

LTV	Lender	Initial rate	Fees
55%	The Mortgage Works	3.99%	£4,090
65%	The Mortgage Works	4.04%	£4,090
75%	The Mortgage Works	4.14%	£4,090

Best variable rate Buy to Let mortgage rates

You may also want to compare the best Buy to Let mortgage rates for fixed deals vs variable.

LTV	Lender	Initial rate	Fees
75%	Newbury Building Society 1.75% discount for 3 years	5.25%	£1,175
75%	Newbury Building Society 1.75% discount for 5 years	5.25%	£1,175
75%	Furness Building Society 3.20% discount for 2 years	5.49%	£1,050

Read our guide explaining Buy to Let Mortgages, for everything you need to know about Buy to Let mortgages. But if you’re specifically looking at what to do in the face of increased Buy to Let mortgage rates, read on.

Will Buy to Let mortgage rates drop?

It’s difficult to predict what will happen to Buy to Let mortgage rates in the next 12 months. We had seen mortgage rates on fixed deals falling, but they nudged up in March 2024. We then saw the best rates on Buy to Let mortgages remain largely unchanged in April 2024 as the markets predicted the Bank of England will cut interest rates in June.

But no one really knows what’s going to happen to Buy to Let mortgage rates in coming months. So the key message is to be fully informed so that you can make the best decision for you. And the easiest way to do this is to speak to a fee-free mortgage broker.

Rising mortgage costs: What are your options?

With Buy to Let mortgage rates in the UK much more expensive than in previous years, if you’re a landlord with a mortgage, you’ll be facing increased mortgage costs. Here are your options:

1.   Remortgage

Even the best Buy to Let mortgage rates are significantly higher than we’ve been used to in previous years. So it’s more important than ever to make sure you’re on the right mortgage; find the best Buy to Let mortgage rates by speaking to a fee-free mortgage broker.

When you remortgage your Buy to Let, you’ll need to consider what type of Buy to Let mortgage (BTL mortgage) you want. If you want financial security you may opt for a fixed deal, however while this means you won’t pay more on your mortgage if interest rates increase, similarly you won’t pay less if interest rates fall. Or you might prefer to take out a variable rate mortgage, in the hope that your repayments may reduce in the future if that base rate falls.

Considering remortgaging your Buy to Let? Find the best Buy to Let mortgage rates by speaking to award winning mortgage brokers L&C

2. Consider selling

According to analysis by agents Hamptons, landlords sold 35,000 more properties than they bought in 2022. So if your Buy to Let mortgage costs are now too expensive, you may decide to join them and cash in and sell up.

Traditionally, there have been two main options for doing this:

• Giving notice to your tenants that you would like them to leave (there are rules you must follow when doing this) and selling the property vacant. This allows time for you to make any improvements to the property before putting it on the market. But you’ll need to pay the mortgage without getting rent, during the period that your tenants have moved out until you sell.
• Or you could sell the property with sitting tenants. This may be appealing to some buyers who are also planning to use the property as a Buy to Let. However, this will limit your pool of buyers and therefore could have a significant impact on how much you can sell the property for. There are also lots of administrative hoops you’ll need to jump through if you choose this route.

Is a short-term let an option while you sell?

However, there is a third option that may offer the best of both worlds from our partner, Flyp, which enables you to earn rental income while you sell your home.

Flyp aim to boost your income by ‘hand selecting’ flexible occupants to stay in your home while it’s on the market for sale. This means you’ll still be earning cash from your home as you try to sell it. They also manage all of the headache of viewings and ensure that the property is cleaned and viewing-ready at all times.

Earn Rental Income While you Sell

See how our partners, Flyp, can help you earn rent and get your property sold.

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Flyp’s service may be an option to consider to help you to continue to earn rent and sell at the same time. Their selling service also provides access to multiple agents at a sole agency fee, so they are worth comparing against other local estate agents.

Additionally, Flyp offer a transformation service if the property needs any enhancements or staging to help it sell. If you sign up with the company and use its ‘Staging to Sell’ service, the company’s tradespeople will make improvements to your property at no cost to you in a bid to increase its value and help it sell faster.

Think your home would sell better with a few improvements but not sure where to start?  Our partners at Flyp can help transform your home to maximise its sale price and achieve a successful sale. Find out more about their transformation service.

What about Quick Sale Firms?

You may find getting a short-term let while you sell is a better alternative to using quick house sale firms, which some landlords use if they want to shift a property quickly because they don’t want it sitting empty during a potentially long-drawn out sales process. However these firms often only pay you 75%-80% of the value of the property, and there are other potential downsides too.

3. Sit out the turbulence

If your mortgage rate hasn’t gone up yet, you could prepare by building up your cash reserves as much as possible now in advance of your mortgage deal coming to an end and being hit with new, higher Buy to Let mortgage rates in the UK.

You could also take this opportunity to consider your future plans. It may be that for a period of time you can take the hit on rising mortgage costs and protect your tenants from increased prices. They are ultimately your customers. Good tenants are hard to come by and you may be more willing to absorb the increased costs and a lower return in the short term to keep them in situ.

And when the market starts to settle and look more positive it’s likely there will be opportunities for landlords. You may find properties selling at a discount that could make a good long term investment.

4. Take a pay cut or inject your own capital

Low rates have meant attractive yields for many landlords in recent years. But no business model is guaranteed to give you good returns every year. When other types of businesses face rising overheads, business owners may have to accept less profit or put their own money into the business.

5. Put up rent

If your Buy to Let mortgage has become more expensive you may want to increase your tenant’s rent – especially if your mortgage payments and other costs are now higher than the rent you receive.

You’ll of course need to follow certain rules if you want to raise rents and these depend on the type of tenancy your tenants have. You may need your tenant’s agreement to increase the rent during a fixed term tenancy agreement. And don’t expect to get it. Everyone is suffering in the cost of living crisis and it’s not your tenants’ responsibility to ensure the rent they pay you is enough to cover your costs if your Buy to Let interest rates increase.

And even if you can increase rents it may not be prudent or in some cases ethical, to increase rents dramatically. However if you are struggling to cover your costs it may be your only option.

Find out how much you can rent your house out for with our handy rent calculator

How can I get the best Buy to Let mortgage rates? 

Just like when you apply for a traditional mortgage, when you apply for a Buy To Let mortgage, the lender will check your credit reports. So to access the best Buy to Let mortgage rates possible, make sure you check them first and ensure everything contained in them is correct. If there are any errors, get these corrected. The best Buy to Let mortgage rates are often reserved for those with large deposits too.

But don’t only look at the best Buy to Let mortgage rates, you’ll need to take into account arrangement fees too. Another benefit of speaking to a fee-free mortgage broker is that they’ll crunch the numbers for you to find you the best deal.

Should I get a fixed or variable interest rate?

When you remortgage your Buy to Let, you’ll need to consider what type of Buy to Let mortgage (BTL mortgage) you want. If you want financial security you may opt for a fixed deal, however while this means you won’t pay more on your mortgage if interest rates increase, similarly you won’t pay less if interest rates fall. Or you might prefer to take out a variable rate mortgage, in the hope that your repayments may reduce in the future if that base rate falls. Read our guide on remortgaging a buy to let for more information.

Considering remortgaging your Buy to Let? Find the best Buy to Let mortgage rates by speaking to award winning mortgage brokers L&C

Am I eligible for a Buy to Let mortgage?

While lenders may vary in their eligibility criteria for a buy-to-let mortgage, you have to be 21 or over, have a good credit score, and some lenders will require a minimum income of usually around £25,000. You’ll also need to have a good deposit.

How much deposit do I need for a Buy to Let mortgage?

Buy to let mortgages work in a similar way to standard residential mortgages, except you’ll usually need a larger deposit. Many lenders offer 95% mortgages if you’re buying a home to live in but with Buy to Let mortgages your deposit will usually need to be at least 20%. For more details, read our guide Buy To Let Mortgages explained.

How much can I borrow on a Buy to Let mortgage?

This depends on how much you’re expecting to earn in rental income. Typically, lenders will want your expected rental income to meet at least 125% of the monthly interest payments on the loan.

What are the Buy to Let mortgage types?

Most Buy To Let mortgages are interest-only. This means you’ll only pay the interest each month. And at the end of the term you’ll need to repay the original loan in full. For more details, read our guide Buy To Let Mortgages explained.

Frequently Asked Questions