Remortgaging may have slowed down for homeowners but the demand for a new deal is set to grow amoung landlords according to a recent survey.  Property investors, about 95%, have borrowed on their current portfolio and almost half, 45%, are expecting to seek out a remortgage in the next three to six months.  Property investors are also looking to diversify their properties throughout the different types. 

According to the survey of 251 property investors by Mortgages for Business, investors plan on increasing their portfolios:

·        29% plan to purchase houses with multiple occupation

·        19% plan to purchase multi-unit freehold blocks

·        15% plan to purchase semi-commercial property

·        15% plan to purchase commercial property

Most of the investors, 34%, favoured 5-year fixed rate remortgages.

David Whittaker, managing director at Mortgages for Business, remarked on the survey results, saying, “With Buy to Let mortgage rates at historic lows, this strategy may well prove prudent in protecting them against future interest rate rises.

“Of those who are not looking to remortgage, we must surmise that some will be keen to hang onto their existing reversion rates for as long as possible.

“It will be interesting to see whether the situation changes as the year goes on. Accordingly the next survey will include a question about recent remortgaging activity.”

Once landlords begin to see higher interest rates, there is little doubt that their fees will increase to keep profit margins in line with their mortgage repayments.  Therefore, renters will see higher fees despite demand falling as more households are becoming home owners.  Many studies have revealed that with the number of historically low mortgage deals on the market that buying is cheaper than renting for most households. 

Homeowners should continue to see cheap remortgage deals available despite the warnings of interest rate increases.  Even if interest rate offers from lenders do creep upward, the level will still be affordable in comparison to the level that remortgages are expected to be one year from now.