Credit, Collections & Insolvency News
Latest data from UK Finance has found that in Quarter 3 (Q3) in 2024 there were 48,862 new buy-to-let loans advanced in the UK, worth £8.6 billion. This was up 6.5 per cent by number (8.9 per cent by value) compared with the same quarter in the previous year.
The average gross buy-to-let rental yield for the UK in Q3 2024 was 6.93 per cent, compared with 6.53 per cent in the same quarter in the previous year.
The number of BTL fixed rate mortgages outstanding was 1.4 million, 3.3 per cent up on a year previously. In contrast, the number of variable rate loans outstanding fell by 14.9 per cent to 541,488. At the end of Q3 2024, there were 13,000 buy-to-let mortgages in arrears greater than 2.5 per cent of the outstanding balance. This was down 570 from the previous quarter but 19 per cent higher than in the same quarter a year previously.
There were 710 buy-to-let mortgage possessions. This is unchanged from the previous quarter, but an increase of 73.2 per cent on the same quarter compared to the previous year.
Commening in the figures, Melanie Spencer, Sales and Growth Lead at Target, said “Given the challenges surrounding the buy-to-let market, it’s encouraging to see a year-on-year increase in lending in Q3. Of course, the data captures the market prior to the Budget and the changes to stamp duty on additional properties.
“However, the market has been resilient and landlords have remained agile, capitalising on a challenging residential market and exploring opportunities further afield to expand their portfolios. There will always be those that will choose to sit back and not expand due to market conditions or policy changes, but conversely, there are those still making the most of the opportunities in the market. After all, demand for good rentals remains high as does rents and the yields available to landlords.
“BTL lenders have continued to innovate too and make movements on rates where possible to help support those landlords either looking to expand or refinance. Timing has always been a critical part of the buy-to-let process, especially now as the demands on landlords increase. To best support brokers and their landlord clients, lenders need to be investing in the latest technology to drive efficiencies in application, decision-making and throughout the entire process to help facilitate transactions.”
Oli Bland, Director of Lending at Black & White Bridging said “The Q3 2024 figures from UK Finance paint a mixed picture of the buy-to-let market. New loans rose by 6.5% year-on-year, and average rental yields increased to 6.93%, reflecting pockets of opportunity for landlords who can navigate the challenges. The North continues to attract investors with its lower entry costs and higher returns, while the growth in fixed-rate mortgages—up 3.3% on the year—shows a shift towards greater stability amidst ongoing economic uncertainty.
“However, the rise in arrears and possessions highlights the pressures many landlords are facing, with increasing costs and policy changes squeezing profitability. While the decline in arrears compared to the previous quarter is a positive sign, it’s clear that the sector remains under strain. For landlords who are prepared to adapt, there are still viable opportunities, but the overall environment requires careful planning and a long-term perspective.”