Buy to let lending growth is matching homebuyers

Buy to let borrowing is rising at the same rate as loans taken out by first-time buyers and home movers as improving BTL rates are helping landlords invest, research reveals.

According to mortgage brokers Alexander Hall, the buy to let mortgage lending market expanded at an average quarterly rate of 7% over the past year.

That puts landlord activity level with both first-time buyers and those moving home – and it says the data shows landlords aren’t leaving the PRS.

In Q3 last year, the latest period available, £6.6bn was advanced to landlords and while this is still the smallest slice of overall mortgage lending at 8.2%, it is a 22% jump on the previous quarter.

It’s also 26% higher than the same period in 2024.

BTL lending is growing

The firm’s managing director, Richard Merrett, said: “While some amateur landlords may have chosen to exit the sector following a string of government regulatory changes designed to dent portfolio profitability, the idea of a widespread landlord exodus simply isn’t reflected in the lending data.

“In fact, our analysis shows that buy to let lending has been growing at the same pace as both first-time buyer and home mover activity over the last year, which underlines that investor appetites remain very much alive.”

He added: “Of course, there have been some notable improvements to the mortgage landscape which will have helped to fuel the fire, with lower rates, greater product availability, and more favourable monthly repayments all helping to support landlord margins and reinforce buy to let’s position as one of the more stable long-term investment options available.

“As confidence continues to return across the mortgage market, we expect this momentum to carry forward into 2026 as the buy to let sector continues to defy the narrative that landlords are calling time and looking to exit.”

BTL sector is growing

The brokerage examined historic figures from the Bank of England, tracking quarterly gross advances by loan purpose to gauge how each segment has performed as conditions have stabilised.

Its findings point to a big upswing.

However, while average quarterly expansion shows that BTL lending matched owner-occupier segments, only remortgaging grew faster.

The firm says that sector grew by 12% on average as households rushed to refinance amid improving mortgage deals.