Should I Buy-to-let?

Enables’ IFA’s in bishops Stortford have been following the Buy-to-Let market post Brexit with interest. Some market analysis by Mortgage Brain has revealed recently that that the costs of buy-to-let mortgages have actually fallen by as much as 8% over the past six months. Meaning many buy-to-let landlords have been benefitting from the continuing reductions of mortgage costs, as lenders across the board have been shaving percentage points off their best deals in an effort to attract greater business from those buying or re-mortgaging property, including buy-to-let landlords.

Part of the analysis of Mortgage Brain’s latest product data shows that the cost of a five-year fixed buy-to-let loan with a 70% loan-to-value (LTV) is now 8% less than it was in March 2016. With the current rate of 2.8%, as of 1 September 2016 there is a potential annualised saving of £738 on a £150,000 mortgage.

Many economists are predicting that the Bank of England will announce another cut to the base rate in November taking it from 0.25% to just 0.1%. If that is the case then there is every chance that mortgage costs could fall even further in the closing months of 2016. Mark Lofthouse, CEO of Mortgage Brain said: “With further interest rate cuts predicted by the Bank of England it will be interesting to see what happens to mortgage rates and costs over the next few months.
“There’s no doubt though that on the whole borrowers and potential buy-to-let investors are in a great position to take advantage of the low rates and cost reductions that we’re seeing.” 

https://www.landlordtoday.co.uk/breaking-news/2016/9/buy-to-let-mortgage-costs-down-by-as-much-as-8

Issued by: Enable Independent Financial Life Planners • 
25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE 

Annuities hit by Brexit

Enable’s IFA’s in Bishops Stortford know the instability of Brexit will continue to impact on financial planning for some time.  And for those who are just retiring or are newly retired the amounts paid by annuity rates will be disappointing. Just Retirement and Retirement Advantage have both recently announced cuts to their annuity rates, and more companies are likely to follow.

Annuities are available for retirees and are a product that offers an income for life, they are usually bought at retirement with all or part of a person’s pension savings.  At the moment annuity returns reflect the current direction of travel in interest rates, and since Brexit they are hitting even lower long-term rates.

“Gilt yields and annuity rates have been dropping steadily over the past year. The events of the past couple of days have given new momentum to that trend.” Says Tom McPhail of Hargreaves Lansdown, “For any investor planning to buy an annuity in the immediate future, it may make sense to do so sooner rather than later. Once you’ve obtained a quote from an annuity company the terms are usually guaranteed for between two and four weeks.”

But the other-side of falling annuity rates is the impact of lower interest rates on mortgages, more and more longer-term fixed-rate mortgages are likely to emerge reflecting falls in gilt yields. To review your pension or your mortgage you might want to talk it over with one of our experienced IFA’s at Enable.

Source: The guardian

Issued by: Enable Independent Financial Life Planners • 
25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 - Fax: 01279 657339
Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority.
It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us.
NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE