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Graham Awards


Landlords will sell up in droves, mortgage chief warns

Landlords are being advised to check when their current mortgage fixed terms are expiring or see whether they wish to have certainty on their monthly repayments by looking at a new fixed rate now.

"The Bank of England's increase in Base Rate from 2.25 to 3.0 per cent follows similar increases in rates from the Fed Reserve in the US and the European Central Bank. These increases are all with the goal of curbing the rapid increase in inflation which has now topped 10 per cent against the Bank of England’s target rate of 2.0 per cent” says Angus Stewart of online mortgager broker Property Master.

He continues: "Landlords should also expect any mortgage on a tracker or variable rate to reflect this rate increase and while many fixed rates are already pricing in this level of interest rate we are seeing continued fluctuations in lenders’ rates. The good news is that there is now greater stability in the financial markets and products are not being withdrawn and repriced as they were immediately after September’s disastrous mini budget.


"We do expect base rate to continue to increase over the next year to between 4.0 and 5.0 per cent so this is a good time for landlords to look at their current mortgage rate and see if they can lock in some certainty of monthly repayment."

Apart from increasing interest rates lenders are also increasing stress rates they use to assess affordability, and Property Master says this can have a significant impact on the amount landlords can borrow when they purchase or remortgage. 

Stewart concludes that landlords are being squeezed on all fronts.  

“With higher interest payments that cannot be offset against tax, a need to improve the energy efficiency of properties, tenants that are likely to struggle to pay rent and the increasing cost of building materials these are already impacting the profitability of buy to let and we expect more landlords to decide it’s now time to sell up.” 

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    Many landlords have been getting out already, wait until the the S H 1 T really hits the fan, you ain't seen nothing yet

  • Elizabeth Campion

    And the Oxford university of life politicians won't work it out Andrew

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    As said, we have been selling up for a while and it will continue at a pace. The government have no clue and will carry on regardless.

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    I can’t believe how incompetent politicians really are. All of there interfering solves some problems sometimes and creates other problems elsewhere. Shame the likes of the NRLA can’t point things out and speak on behalf of landlords instead of the limp Ben Beadle.

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    Yes probably not a good time to get into BTL due to interest rates and stress testing. So even more reason to sell properties once vacant rather than tenanted. I sold a tenanted one last year and it was painful and took nearly a year. So in future will have to give notice, just feel sad for good tenants who will struggle to find a new place, and will have to downsize unless they can find another £250 pcm.


    "unless they can find another £250 pcm" is a very valid point. They may have to find that plus moving costs even if they do downsize. A great many long term tenants have had very modest or no rent increases for years. Their current rent is much lower than the current market rent for smaller houses. Even with a fairly hefty increase they would still be better off staying where they are. If the landlord can be persuaded to hang on and not sell.

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    It is remarkable to me that the Politicians cannot see the problem they have created. Interest rates in reality are still low. Base rate is just 3.00%. Why the mortgage companies need to virtually double this needs to be addressed.
    The Government should phase out or reduce the tax that is paid on mortgage payments and not include this as it is under section 24, that will ease the pressure on mortgaged Landlord's and therefore tenants.
    Even if they were to do this I am still selling at least a third of my portfolio in order to restructure the debt to equity in my favour. However, if prices fall more than I expect I will hold. Fortunately I have had tenants leave and am only evicting one household due to thousands in arrears.

  • George Dawes

    Andrew is 1000000% correct

    You ain't seen nuthin' yet !!!!

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    The phrase “Perfect Storm” has never been so apt!

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    • L C
    • 07 November 2022 12:06 PM

    We are seeing this already.
    Add this to a non existent buy to let market and the government will wonder why rents are spiraling when tenants struggle to find properties.

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    My son has just put his one rental on the market and is evicting a lovely family who have had a great house on low rent for 5 years. He is on apprentice wages and cannot afford the energy efficiency costs needed before 2O25 and is not prepared to loose thousands as values drop over the next two years. The family can't afford current rents. Why can't this government see what devastation they are causing to the poorest in our society. ????

  • Elizabeth Campion

    Levelling up apparanly!


    Levelling down first is needed so these incompetent fools have a low bar set so they can actually achieve some levelling up!


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