The first quarter saw £10.8bn of new BTL loans advanced, up 7% from the same point in 2025.
The latest quarterly update from UK Finance shows that this sum was made across 58,272 new loans during this period, or 3.26% more than in Q1 2025.
Landlords also made more from their properties during this time.
The average gross BTL rental yield for the UK in Q1 2026 was 7.21%, compared with 6.93% in the same quarter a year previously.
There were also fewer BTL mortgages in arrears.
At the end of Q1 2026 there were 8,960 BTL mortgages in arrears greater than 2.5% of the outstanding balance. This was down 560 from the previous quarter.
There were 810 BTL mortgage possessions taken in Q1 2026, unchanged from the same quarter a year previously.
The number of BTL fixed rate mortgages outstanding in Q1 2026 was 1.47 million, 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.
Mark Harris, CEO at SPF Private Clients, remarked that this data seemed to show the Renters Rights Act hadn’t deterred landlords.
“An increase in new BTL 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,” said Mark.
“Perhaps the uptick in average yields explains that – investing in rental property is still working for many landlords and experienced ones in particular are expanding their portfolios where opportunities arise.”
He added that the outlook was “brighter” than expected as the PRS evolved.
“The sector is becoming more professional and with more landlords incorporating in order to maximise returns, there are plenty of opportunities out there,” said Mark.
“However, now is not the time for further interference from the government — the sector needs time to settle and get to grips with recent legislative changes."
Louisa Sedgwick, managing director of mortgages at Paragon Bank, also took solace from the data.
“Although BTL 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,” said Louisa.
“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.”
