0:01 AM, 26th June 2025, About 3 weeks ago
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Portfolio landlords in the UK could see their mortgage costs soar by more than £23,000 over two years if they fail to refinance, research reveals.
According to property finance firm Rangewell, those landlords who act swiftly could reduce their expenses by £8,563 over the same period due to improved mortgage conditions.
Its analysis examined the typical debt held by portfolio landlords through buy to let mortgages and the financial implications of refinancing versus reverting to a standard variable rate.
The firm’s head of partnerships, Alasdair McPherson, said: “The mortgage market has moved decisively back in favour of portfolio landlords – but the gap between best-in-market rates and legacy rates that landlords can fall into through lack of research or professional funding support is now dangerously wide.
“For portfolio investors, this isn’t just about individual savings – it’s about managing cash flow on a property-by-property basis, leveraging equity to grow the portfolio, and avoiding thousands in unnecessary cost.”
Rangewell says that two years ago, the average portfolio landlord owned 8.6 properties, financed through 5.8 loans, with a total BTL mortgage debt of £503,680.
At that time, a two-year fixed-rate BTL mortgage at 75% loan-to-value carried an average interest rate of 4.78%, resulting in a monthly interest-only repayment of £2,006.
Today, with mortgage rates improving, the average rate for the same mortgage type has dropped to 3.93%.
Landlords refinancing at the end of their fixed-rate term could lower their monthly interest-only payment to £1,650, saving £357 per month or £8,563 over two years.
However, those who do not refinance risk slipping onto a standard variable rate, which averages 7.09%.
This would increase their monthly repayment to £2,976, adding £970 per month or £23,270 over two years.
Rangewell is also highlighting refinancing opportunities in niche property sectors.
It says that semi-commercial properties, such as flats above shops, are seeing increased lender interest, often securing better terms than standard residential portfolios.
Holiday let portfolios benefit from strong yields and growing lender flexibility, enabling cost reductions and equity release for expansion.
Supported living and social care portfolios, previously challenging for lenders, now attract specialist providers, improving refinancing and growth prospects.
Foreign investors with UK portfolios are also finding more competitive rates, while houses in multiple occupation (HMOs) and multi-unit freehold blocks (MUFBs) are particularly attractive to lenders, offering significant savings and portfolio enhancement potential.
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