NatWest announcing a reduction in its buy-to-let stress test rates is a “massive win for landlords”, according to Our Mortgage Broker Limited director, Akhil Mair.
NatWest’s announced it will be reducing its 2-year fixed rates from 7.81 per cent to 7.33 per cent and lowering its 5-year fixed rates from 6.68 per cent to 5.95 per cent.
Additionally, for like-for-like remortgages, a decrease from 7.15 per cent to 6.27 per cent was announced.
Mair greeted this announcement with positivity, stating it will be beneficial to landlords who have “suffered setback after setback of late”.
He additionally described the announcement as a “strategic move” to attract more business from this segment of the market and stay competitive.
However, he also pointed out that this reduction will not only be beneficial to landlords but will also “support tenants indirectly”.
A similar sentiment was also expressed by R3 Mortgages founder and director, Riz Malik, who described the announcement as a “big boost for landlords”.
He stated that the reduced stress rate is a “good indication” that lenders view the recent inflationary rise as a “mere blip” in the “long term road of reductions”.
Additionally, Orchard Financial Advisers managing director, Ben Perks, said: “This is a great example of how a lender can show a real appetite for lending without competing solely on rate.
“In the buy-to-let space affordability has been the biggest challenge over the past 12 months as rate rises have forced lenders to harshen their stress tests.
“The relaxing of these stress tests is a welcome change and will benefit many borrowers that are struggling to afford, on paper, the mortgages they already have.”
Parks concluded by pointing out that better mortgage options for landlords will lessen their need to raise rents and described the announcement as a “really positive move by NatWest”.
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tom.dunstan@ft.com
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