The organisation said that the value of lending rose to £9.6bn in quarter four of 2024. There were 52,648 new buy-to-let loans advanced in the UK, up 39.2% by number compared with the same quarter in the previous year.
Rental yields rose for landlords, with the average gross buy-to-let rental yield for the UK up to 7%, compared with 6.74% in the same quarter in the previous year.
The average interest rate fell across all new buy-to-let loans in the UK to 5.09% in Q4 2024. This was 0.13 basis points lower than in the previous quarter, and 0.61 basis points lower than in the same quarter of 2023.
Russell Anderson, commercial director of mortgages at Paragon Bank, said: “Figures published today by industry body UK Finance reveal a resurgent buy-to-let market throughout 2024, with strong growth in both purchase and remortgage activity,
“The data supports our view that landlords are astutely managing their lettings businesses, borrowing to invest in higher yielding properties or refinancing to proactively manage debt across portfolios and improve privately rented housing stock.
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“While encouraging, this increase is against a low base in 2023 and there continues to be an acute supply demand imbalance in the private rented sector, underpinning rental inflation. More investment is needed into the sector to meet forecast levels of demand, so we would hope to see the momentum of last year continuing as the market recovers.”
Arrears and possessions
At the end of Q4 2024 there were 12,610 buy-to-let mortgages in arrears greater than 2.5% of the outstanding balance. This was down 390 from the previous quarter and 7% lower than in the same quarter a year previously.
There were 700 buy-to-let mortgage possessions taken in Q4 2024. This was unchanged from the previous quarter, but an increase of 29.6% on the same quarter a year previously.
