Merry Christmas and here's to a better 2009!

To new and regular visitors to our Buy to Let Blog, I would like to wish you a very merry Christmas and a happy & healthy New Year. 2009 will be a tough year but as always, Mortgages for Business is well placed to advise and assist with your funding options.

Base Rate looks set to reduce further (don’t be surprised to see a further 1% cut as early as January!) and I predict that Base Rate will fall below 1% before the half year. Great news for all those on Base Rate tracker mortgages and many portfolio landlords will see improvements to cashflow as those tracker mortgage repayments continue to fall in the New Year.

The availability of Buy to Let mortgages remains an issue and despite the rapid fall in Base Rate, lenders will be taking a cautious approach going into 2009. The 3m Libor rate remains a full 1% higher than Base Rate and despite the Treasury’s efforts to get Banks lending to each other again, it may still take a month or two before confidence returns to the money & mortgage markets. That said, with SWAP rates bottoming out, I would expect to see the introduction of attractive 3 and 5 year fixed rates early in the new year and I would strongly recommend landlords to consider locking into decent 3 and 5 year money early in 2009. Mortgages for Business will continue to keep landlords updated as new products are launched.

With the New Year will come opportunities for those landlords who are in a position to purchase and add to their portfolios. Whilst there are many economists predicting a further 10 – 15% reduction in house prices, many landlords are taking advantage of the current climate and snapping up bargains where possible. Funding for purchases is available but as mentioned in previous blogs, lenders are looking for minimum deposits of 25-30% and investors should be prepared to pay more commercial type rates for what, in essence, is a commercial transaction. Our Landlord Information Zone can give you more insights.

I will update you further in the New Year when we should get a clearer idea of lender appetite and product availability. In the meantime, enjoy the festivities and all the very best for 2009.