Landlord borrowing increases by 19%

15th September 2023

The amount of money owed by landlords on  buy-to-let properties has increased by 19% in the last year according to research by Octane Capital

The research found that the average total amount of each landlord’s buy to let mortgage debt, in the first quarter of 2022 landlords owed lenders an average of £467,548, which rose a year later to £558, 423.

The increase is the result of a greater need to borrow against the property, with average buy-to-let loans also increasing by 12% in the past 12 months.

Areas with the greatest borrowing rise were the West Midlands and the Southeast which both saw a 49% increase in the last year. This resulted in a 33% increase in the amount of money owed by landlords in the West Midlands, while in the Southeast the amount increased by a whopping 95%.

In the East of England there was a 29% increase in buy-to-let borrowing, with a 90% increase in money owed. London also saw a considerable 78% climb in money owed through buy-to-let mortgage loans.

Jonathan Samuels CEO of Octane Capital, said “The high cost of borrowing is clearly having a significant impact on buy-to-let landlords. The number of loans held has increased across the majority of the country, as has the total amount owed as a result of these loans.”

“While it’s clear that a lot of landlords are willing to saddle more debt in order to keep their operation moving, it’s inevitable that a significant number will either downscale their ambitions, or jump ship entirely.”