Over half of BTL landlords have been forced to remortgage in the past year, according to the latest Pepper Money Specialist Lending Study.
Over half of BTL landlords (53%) have had to remortgage in the last 12 months, with 56% of these having seen their mortgage payments increase by more than 20%.
In terms of the cost being put onto tenants, 26% of landlords have increased rents by between 21% to 30%. Close behind this, 22% had increased rents by up to 40% — A smaller allocation, 15%, had increased rents by up to 10%.
The research also found that more adults had experienced credit, with 15 million having missed payments in the past.
Specifically, 8.4 million people have experienced adverse credit in the past three years — this percentage is an increase of 21% from 2023.
This has direct impacts on renting markets. Renting from a private landlord was found to be the second highest proportion of these people with 24%, close behind 26% who own their home outright.
Out of this, 6% have borrowed money to pay rent. However, adverse credit is not entirely nullifying home ownership ambitions. Tellingly, 5% still want to purchase a BTL investment.
“Despite these challenges, there’s still a strong desire for homeownership among those with adverse credit, with 64% of those who don’t currently own a home, saying that they aspire to do so in the future — and 1.76 million people with adverse credit are planning to buy a property in the next 12 months,” commented Rob Barnard, director of intermediary relationships at Pepper Money.
“This research suggests that an increasing number of people are going to miss out on a mortgage from a high street lender — but this doesn’t need to stand in the way of their goals, and brokers are best placed to help those customers secure the mortgage they need to live the lives they want.”
