A rise in the number of landlords investing in buy-to-let mortgages indicates that the lettings market remains strong despite economic fluctuations. Recent data shows an increase in landlords purchasing rental properties, reinforcing the sector’s long-term stability.
As Chief Commercial Officer of buy-to-let lender Fleet Mortgages, Steve Cox is an expert in property finance. After analysing market data from the past year, he has shared his insights on the buy-to-let (BTL) sector, and the outlook is promising.
In an analysis for Mortgage Solutions magazine, Cox noted that BTL had outperformed expectations in 2024 and started 2025 on a positive trajectory.
“I think we sometimes underestimate the resilience of our market,” he said.
Cox highlighted new figures showing a 6.5% rise in buy-to-let loans and an 8.9% increase in total lending value in the third quarter of last year.*
Meanwhile, overall BTL lending in 2024 reached £33.2bn, significantly exceeding the £27bn forecast by industry experts.**
“We’re seeing no slowdown in the number of existing borrowers who want to keep on purchasing,” Cox said.
“Plus, we’ve also seen a slight rise in first-time landlords investing, perhaps revealing that property remains a go-to asset class for many.”
Why Are Landlords Investing in Property?
Cox identified several key factors driving both new and experienced landlords to expand their portfolios:
Strong Rental Yields
Rental yields remain high, with the average UK private rent increasing by 9% in the year ending December 2024.* This growth makes buy-to-let an attractive option for those seeking consistent returns.
High Tenant Demand
While the government has pledged to accelerate housebuilding, it will take years to address the housing shortage.
“There are some market fundamentals that are simply unshakeable, including supply-side shortages,” Cox said. The high demand for rental properties continues to fuel investment in the sector.
Affordability Challenges for First-Time Buyers
Despite recent interest rate reductions, many first-time buyers struggle to save for a deposit due to the cost-of-living crisis. As homeownership remains out of reach for many, demand for rental properties remains strong, presenting an opportunity for landlords investing in buy-to-let properties.
Regulatory and Market Changes
The buy-to-let sector has become increasingly professionalised due to recent regulatory changes, ensuring higher standards in the industry.
Additionally, the BTL mortgage market has grown more complex, with a wider range of financial products now available. Cox advises those looking to remortgage or take out a buy-to-let mortgage for the first time to seek professional guidance.
Work With a Trusted Expert
Whether you’re a seasoned investor expanding your rental portfolio or a first-time landlord investing in buy-to-let, working with an experienced adviser can help you navigate the changing market.
If you’re considering entering the buy-to-let sector or want to discuss the local lettings market, contact us today for expert advice.
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