Landbay has launched two new buy-to-let mortgage products for houses in multiple occupation (HMO), for first-time landlords.
The products, which are available for HMOs with up to six bedrooms and includes new build properties, are both up to 70 per cent loan-to-value and come with a 1.5 per cent fee.
There is a two-year fix at 3.29 per cent and a five-year fix at 3.79 per cent.
The specialist buy-to-let mortgage lender said it created the products following broker feedback informing the online lender of a rise in enquiries from informed first-time landlords who are attracted by the higher yields HMOs can generate.
Read more: Landbay makes changes to product range
“Landlords are becoming more sophisticated and they understand the responsibilities of managing an HMO,” said Paul Brett (pictured), managing director, intermediaries at Landbay.
“They have done their homework and know the yields on HMOs are much higher than single flats or houses resulting in greater financial rewards.
“There is also more demand for living in HMOs, particularly from young professionals who want or need to share a house.
“Some simply can’t afford to rent their own place but many actually like communal living. Much of the HMO accommodation is far better quality than it used to be and can demand a higher rent.”
Last month, Landbay launched green mortgages with lower rates than its counterpart range to incentivise energy efficient rental properties as an attractive option for landlords.
In May, the online lender reduced rates and fees across its core buy-to-let product range and upgraded its broker portal.