As a rising number of landlords face higher rates when their mortgage deals expire, buy-to-let investors across the UK are now collectively paying £15bn in mortgage interest annually, new research shows.

The figures show this up 40%, or £4.3bn, over the last 12 months and 58% (£5.5bn) since it bottomed out in November 2021.

This rise reflects a combination of new investor purchases at higher interest rates, existing tracker rates increasing, and fixed-term mortgage deals expiring. The hike comes even though the number of outstanding buy-to-let mortgages has been falling since November 2022 as investors have either paid down debt or sold up. Despite this, the total value of all mortgages has remained broadly flat over the same period.

Whilst this has been reflected in the steepest rises in rent since OST records began, rents have not rises by the same percentage as mortgages. This is in part due to many landlords cushioning the blow for sitting tenants but with the BTL sector becoming less profitable and the government refusing to tax landlords fairly, on the same basis as other businesses, the suppy of private rental accommodation is shrinking. One expert estimate suggests that around one third of a million landlords in the UK are poised to sell up.

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