New figures from the mortgage lenders’ body UK Finance show remortgaging increasingly popular amongst landlords.
In Q1 2026 – the figures just released – there were 58,272 new buy-to-let (BTL) loans advanced in the UK, worth £10.8 billion.
This was up 3.26% by number compared with the same quarter in the previous year, and up 7.02% by value.
Within this total, buy-to-let remortgages grew to 39,160, up 11.1% compared to the same quarter a year previously, while the number of loans for house purchase fell by 14.9% to 16,871 in Q1 2026.
In Scotland and Wales buy-to-let House Purchase grew 22.6% and 20.6% by volume.
England and Northern Ireland, however, fell by 18.7% and 11.8% respectively.
The average gross buy-to-let rental yield for the UK in Q1 2026 was 7.21%, compared with 6.93% in the same quarter a year previously.
The average interest rate across all new buy-to-let loans in the UK was 4.71 % in Q1 2026. This was 6 basis points lower than in the previous quarter, and 29 basis points lower than in the same quarter of 2025.
Reflecting the downwards movement in interest rates, the average buy-to-let interest cover ratio (ICR) for the UK in Q1 2026 was 221%, up from 204% in Q1 2025 and 218 in the previous quarter.
The number of BTL fixed rate mortgages outstanding in Q1 2026 was 1.47m, 1.4% up on a year previously.
In contrast, the number of variable rate loans outstanding fell by a further 9.5% to 453,000.
At the end of Q1 2026 there were 8,960 buy-to-let mortgages in arrears greater than 2.5% of the outstanding balance. This was 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.
Commenting on the figures Louisa Sedgwick – managing director of mortgages at Paragon Bank – says: “Although buy-to-let lending moderated from the stronger levels seen at the end of 2025, activity in the first quarter remained ahead of the same period last year, indicating that the market continues to move in the right direction where conditions are supportive.
“Remortgaging remained a significant driver of lending and was higher than a year earlier. This points to landlords actively refinancing as they respond to broader affordability considerations and manage their portfolios, including supporting longer-term plans such as expansion and investment in existing properties.
“The value of outstanding balances also rose above £313 billion, underlining the resilience of the sector and its continuing role in supporting investment in privately rented homes.”
And Mark Harris, chief executive of mortgage broker SPF Private Clients, adds: “Landlords continue to favour fixed-rate mortgages for the certainty they bring in what are volatile times in terms of pricing, with the number opting for variable rate loans falling.
“The average interest rate across new BTL loans was six basis points lower than the previous quarter and 29 basis points down on the same quarter last year, with this downwards trend a further factor encouraging landlords to invest. With the average interest cover ratio rising thanks to falling lending rates, landlords are not overstretching themselves.
“With the number of landlords in arrears falling and possessions unchanged, the outlook for the sector is brighter than one might think given that the regulatory and tax burden on investors is increasing. The sector is becoming more professional and with more landlords incorporating in order to maximise returns, there are plenty of opportunities out there.”
This article is taken from Landlord Today