New official buy-to-let lending figures have revealed an extraordinary revival in the landlord market.
UK Finance has today released figures revealing that during the first three months of the year there were 58,347 new buy-to-let loans advanced, worth £10.5 billion.
This represents a 39% by number and 47% by value increase compared with the same period last year. The trade body, which represents the nation’s lenders, also reveals more good news for landlords – an increase in rental yields.
Average gross buy-to-let rental yield was 6.94% during the first quarter of the year, compared with 6.88 per cent during the same period last year.
Louisa Sedgwick, MD of Mortgages at Paragon Bank
“Buy-to-let lending in the first quarter of the year was the highest seen since the mini-budget and in line with pre-pandemic levels, primarily driven by a surge in new purchase activity ahead of the changes to Stamp Duty thresholds at the end of the quarter,” she says.
“This shows that with the right market conditions landlords will invest. Demand currently exceeds supply and is forecast to continue, driven by factors such as population increases and household formation changes.
“To meet this demand and help to moderate rent inflation, as well as to provide a home to millions of tenants across all walks of life, it is essential to facilitate an attractive investment environment with balanced regulation and economic stability.”
Nathan Emerson, Chief Executive of Propertymark
“It is positive to witness what we hope is a wider scale revival in buy-to-let lending across Q1 of 2025,” he says.
“This trend has likely been encouraged by interest rates on buy-to-let loans being lower than they were in the same quarter for 2024.
“These numbers demonstrate that more competitive interest rates are helping to attract more people to the buy-to-let market.”
“However, with mortgage possessions up this quarter from the same quarter a year previously, these figures also highlight there are still significant affordability issues for those engaging in buy-to-let borrowing in recent years.
"The Bank of England continues to work hard managing inflation levels, and the direction of travel here will prove key within all base rate decisions moving forwards.”
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