Extra lenient buy-to-let stress checks are rejuvenating the market with extra product alternative and decrease charges, analysis from mortgage adviser Alexander Corridor has discovered.
In March 2025 the Financial institution of England lifted the requirement for debtors choosing a set charge of lower than 5 years to be stress examined at a lender’s normal variable charge plus 1%.
The consequences of the adjustments have already been felt throughout the market, as the typical variety of buy-to-let mortgage merchandise obtainable between January and June 2025 rose to 2,752, up 41.9% in comparison with the identical interval final 12 months.
Charges have additionally improved considerably, as the typical 2-year fastened buy-to-let mortgage at 75% loan-to-value has fallen from 4.78% in Might 2023 to only 3.93% in Might 2025, a discount of 0.85% over two years and 0.61% year-on-year.
Richard Merret, managing director of Alexander Corridor, stated: “The easing of stress testing guidelines is a vital step ahead for the buy-to-let sector.
“We’ve already seen a noticeable enchancment in product availability and borrowing affordability, serving to landlords higher handle their portfolios and capitalise on new alternatives.
“At a time when the rental market is below stress from excessive demand and low provide, these adjustments supply a much-needed enhance to investor confidence and market fluidity.”
These decrease charges ought to lead to extra funding exercise throughout the buy-to-let sector, significantly amongst portfolio landlords {and professional} buyers who’ve been most impacted by stricter affordability checks in recent times.
