"We’re seeing a clear behavioural shift as landlords respond to higher borrowing costs and tighter yields"
- Nakita Moss - Twenty7Tec
New data from Twenty7tec shows that buy-to-let activity is cooling as landlords turn their attention from expansion to refinancing existing portfolios.
Buy-to-let purchase searches have fallen 13.67% year-on-year, while remortgage searches have increased by 6.05%. After five years of strong activity, including a peak in September 2022 when buy-to-let accounted for 21% of all mortgage products, many landlords are now focused on protecting assets rather than growing portfolios.
“We’re seeing a clear behavioural shift as landlords respond to higher borrowing costs and tighter yields,” said Nakita Moss, head of lender relationships at Twenty7tec. “More landlords are focused on refinancing rather than expanding, taking advantage of stabilising rates to secure long-term certainty. The era of portfolio growth has paused, for now it’s about resilience and risk management.”
The firm’s latest October data shows that buy-to-let purchases now make up 33.1% of all landlord searches, meaning two-thirds of activity currently relates to remortgaging.
Across the wider mortgage market, Twenty7tec reported a record 28,835 products live at the end of October, the highest ever recorded. This indicates confidence among lenders, even as purchase demand cools in the lead-up to the Autumn Budget.
For first-time buyers, searches have fallen to their weakest point of the year at 297,387, reflecting continued caution as borrowers await greater economic clarity.
Landlords are also keeping a close eye on potential changes to property taxation, stamp duty thresholds and rental market incentives. After years of regulatory shifts and reduced tax relief, many are hoping for measures that will help rebuild confidence in the sector.
In 2024, the Autumn Budget’s most significant announcement for landlords was an increase in the additional stamp duty rate, known as the ‘higher rate surcharge’, applied to second homes, investment properties and purchases made by corporate investors. The surcharge rose from 3% to 5%, taking effect on 31 October 2024.
Following this change, buy-to-let transactions fell sharply, dropping 9.36% in November compared with the previous month and a further 35.28% in December, underlining how sensitive the market remains to fiscal adjustments.
“The figures suggest a market in transition: steady, active, and cautious,” said Nathan Reilly, commercial director. “Landlords appear to be locking in rates while they can, signalling confidence in the long-term rental market but restraint when it comes to expansion.”
Alex Greenin, the mortgage guy who uses Twenty7tec daily, shared a similar view. “I have seen a bit of a slowdown in buy-to-let purchases, but people are still investing, just not at full speed,” he explained. “They’re being more calculated with their choices. I completely agree that landlords are focusing on remortgaging as fixed rates come to an end. They’re working hard to make their portfolios perform as efficiently as possible. The smaller, back-room landlords have definitely taken a hit over the past few years. There isn’t as much profit in buy-to-lets as there used to be, and that’s forcing many to rethink their strategy rather than expand.”
