Buy-to-let (BTL) investors continue to benefit from falls in mortgage rates, particularly those looking for longer-term agreements.
Analysis by Moneyfacts.co.uk shows that the average five-year fixed rate for a 75% loan-to-value buy-to-let mortgage has fallen below 4% for the first time.
Yesterday, the average was 3.96%, marking a fall of 0.49% in the last six months.
The average five-year fixed rate for a 70% loan-to-value mortgage is also now 3.96%, down from 4.38% in March.
For a 60% loan-to-value mortgage, the average five-year fixed rate is 3.48% - dropping from 3.61% last month and 3.73% in March.
Charlotte Nelson, a finance expert at Moneyfacts.co.uk, says that the Bank of England's decision to slash the base interest rate last month has already had a favorable effect on buy-to-let mortgage rates.
"All LTVs for five-year fixed rates have reached the lowest in the market this month," she says.
Nelson speculates that as fixed rates for five-year mortgages continue to decrease and more tenants opt for longer tenancies, buy-to-let could become more of a 'long-term prospect' for investors.
She reiterates, though, that while the cost of obtaining a mortgage may have reduced, there are additional costs that agents' clients need to factor in, including the 3% stamp duty surcharge introduced in April and changes to the tax relief system being introduced next year.
"Low rates may make BTL an attractive option, but borrowers should remember that a BTL investment is not without its risks, so it is important for any potential landlords to seek financial advice," adds Nelson.
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