UK Finance today releases its quarterly buy-to-let update for Q1 2025 examining key trends within the UK’s buy-to-let mortgage market. The highlights can be found below.
Key data highlights:
- In Q1 2025 there were 58,347 new buy-to-let loans advanced in the UK, worth £10.5 billion. This was up 38.6 per cent by number (46.8 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 Q1 2025 was 6.94 per cent, compared with 6.88 per cent in the same quarter in the previous year.
- The average interest rate across all new buy-to-let loans in the UK was 4.99 per cent in Q1 2025. This was 10 basis points lower than in the previous quarter, and 41 basis points lower than in the same quarter of 2024.
- Reflecting the downwards movement in interest rates, the average buy-to-let interest cover ratio (ICR) for the UK in Q1 2025 was 202 per cent, up from 190 per cent in Q1 2024 and unchanged from the previous quarter.
- The number of BTL fixed rate mortgages outstanding in Q1 2025 was 1.44 million, 4.99 per cent up on a year previously. In contrast, the number of variable rate loans outstanding fell by 15.8 per cent to 500,000.
- At the end of Q1 2025 there were 11,830 buy-to-let mortgages in arrears greater than 2.5 per cent of the outstanding balance. This was down 780 from the previous quarter.
- There were 810 buy-to-let mortgage possessions taken in Q1 2025, up 28.6 per cent on the same quarter a year previously.
