Buy-to-let (BTL) landlords continue to favour the stability of a fixed rate mortgage, with the majority set to choose a five-year fixed rate when they come to remortgage, Landbay has revealed.

When asked for their loan of choice when it comes to remortgaging a property, 71% of landlords said they’ll choose a five-year fixed rate option.

This is an increase of 22% compared to Landbay’s previous survey last year.

The new survey data also found that one in five (20%) landlords are set to opt for a two-year fixed rate, which is a drop from a third (33%) in the previous survey.

Landbay added that "surprisingly", longer-term fixes of seven or 10 years fixes saw a slight increase in preference, jumping by 2% to 6% in the last year. Variable tracker rate mortgages are less popular than last year, with just 3% of landlords set to make this choice, a fall from 14% in 2023.

Sales and distribution director at Landbay, Rob Stanton, said: "The topic of mortgage maturity is regularly discussed in the residential market, but we mustn’t forget the many landlords set to remortgage too. As we have seen in previous years, our data shows that fixed-rate products continue to be the product choice for many, providing that welcome stability in a challenging market and climate.

"It is interesting to see a decline in demand for trackers, particularly as we enter a period where we could see further movement on base rate, and in turn on mortgage rates. This, along with a small increase in demand for longer-term fixes may highlight that some landlords are still a little way off from remortgaging and are hoping to make their move during more favourable market conditions."

Landbay added that of those planning to choose a five-year fixed rate, the majority is made up of those operating within limited companies (71%).

Over two in five (42%) landlords with portfolios between four and 10 properties made up the biggest share of those opting for a five-year fix, followed by 24% of landlords with portfolios of 20 properties or more.

Stanton added: "It’s an important reminder that brokers need a broad range of products at their disposal to support a broad range of requirements among their landlord clients. This has been a primary focus at Landbay, making sure we have options to support all requirements, whether it’s trackers, two-year or five-year options – in addition to our like-for-like range to support those with no change to their current borrowing requirements."

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