UK Finance data shows market continuing to hold its own
The latest figures for the buy-to-let sector show ‘incredible resilience’, proving that property investment remains highly attractive, according to reaction to UK Finance’s quarterly update.
The figures showed that in the first quarter, 58,272 new buy-to-let loans were advanced in the UK, up by 3.26% compared with the same quarter last year and worth £10.8 billion, a 7.02% rise in value.
“The latest Q1 data from UK Finance shows an incredibly resilient buy-to-let sector,” said Raheel Butt, head of BTL underwriting at MT Finance. “With figures showing a total lending volume of £10.8 billion across more than 58,000 loans, this proves that property investment remains a highly attractive, core asset class.”
“What we are seeing is a strategic restructuring of the market. The 11.1% surge in remortgaging activity highlights a proactive landlord community. Savvy investors are taking control and optimising their existing portfolios. While high borrowing costs and preparation for the Renters’ Rights Act naturally caused a temporary dip in new house purchases, the fundamental demand for quality rental housing across the UK is stronger than ever,” said Butt.
Landlords undeterred
Mark Harris, chief executive of SPF Private Clients, agreed: “Although the implementation of the Renters’ Rights Act was imminent during the period this data covers, it doesn’t seem to have deterred landlords. An increase in new buy-to-let loans advanced in the first quarter of the year, up compared with the same period the previous year, points to investors who still recognise opportunities in the market.”
The figures showed that average gross buy-to-let rental yield for the UK also rose, up to 7.21%, compared with 6.93% year on year.
The number of BTL fixed rate mortgages outstanding in Q1 2026 was 1.47 million, 1.4% up, while the number of variable rate loans outstanding fell by a further 9.5% to 453,000.
The average interest rate across all new buy-to-let loans in the UK was 4.71% in Q1 2026, 6 basis points lower than in the previous quarter, and 29 basis points lower than in the same quarter of 2025.
Mortgages in arrears falls
At the end of the first quarter, 8,960 buy-to-let mortgages were in arrears greater than 2.5% of the outstanding balance, down 560 from the previous quarter. There were 810 buy-to-let mortgage possessions taken in Q1 2026, unchanged from the same quarter a year previously.
Richard Pike, sales and marketing director at Phoebus Software, said: “While some smaller landlords have chosen to exit amid higher costs and regulatory change, larger portfolio landlords continue to invest and adapt. The trend shows the buy-to-let market is becoming more professional, not less resilient.”
“Importantly, that transition has not been accompanied by rising levels of distress. Buy-to-let arrears remain low, demonstrating the sector’s resilience despite a challenging economic backdrop.”