Buy-to-let mortgage lending in the UK is on course to climb by 14% this year, according to fresh analysis from the Intermediary Mortgage Lenders Association (IMLA), with a further 11% boost expected in 2026. The projected increase would see total lending rise to £42 billion, driven by falling interest rates and a sustained rise in rental prices.
The figures come at a time of persistent imbalance between rental supply and tenant demand, particularly in major urban centres. As a result, landlords are enjoying stronger yields, with property prices rising at a slower pace than rents—further improving the affordability of buy-to-let investments.
Landlords Adapt as Market Shifts
Faced with evolving regulations, tax changes, and fluctuating interest rates, many landlords are rethinking their investment strategies. A growing trend has emerged in the form of landlords operating through limited companies—a shift that experts say offers greater tax efficiency and long-term financial benefits.
New data from Coventry for Intermediaries reveals that 72% of landlords who use a limited company structure entered the market within the past five years. Notably, 30% of these were first-time investors, highlighting how limited companies are reshaping the entry point for property investment.
“Landlords are becoming increasingly sophisticated,” said Sarah Brown, senior mortgage proposition manager at Coventry for Intermediaries. “They’re thinking about structure, tax planning, and long-term goals in a way that’s much more strategic than we’ve seen before.”
Income and Asset Growth Top Investment Motivations
Coventry’s research also sheds light on the motivations behind property investment. Nearly half of surveyed landlords (47%) cited regular income as their primary reason for investing, while 42% were focused on building assets or preparing for retirement—underscoring property’s enduring appeal as a tool for long-term wealth building.
Many investors are using the capital growth from their existing properties to fund portfolio expansion, a strategy made more viable by today’s favourable market conditions.
Limited Companies Offer Strategic Advantages
The benefits of limited company ownership go beyond tax advantages. Landlords also cited improved professionalisation of their portfolios and the ability to separate personal and business finances as key drivers behind the shift.
Mortgage lenders are responding to this trend by refining their offerings. “We’ve listened closely to what brokers are telling us and built our limited company buy-to-let proposition around that,” added Brown. “By combining simplicity, service, and expertise, we’re helping brokers deliver better outcomes – and grow their business along the way.”
Regulatory and Economic Challenges Ahead
Despite the positive lending outlook, landlords face a range of upcoming challenges. Chief among them is the Renters’ Rights Bill, currently at the Report Stage in the House of Lords. While 74% of landlords say they feel prepared for the bill’s implementation, 26% admit they are not.
Additional concerns include a potential freeze on income tax thresholds (with 25% of landlords feeling unprepared), rising property prices (24%), and looming changes to energy efficiency standards (22%).
With such headwinds on the horizon, the need for expert guidance is expected to intensify. Coventry’s report concludes that brokers will play an increasingly vital role in helping landlords navigate a complex and fast-changing landscape.
As the UK rental market evolves, one thing remains clear: adaptability will be essential for landlords seeking to remain competitive—and profitable—in the years ahead.