Recent data from the Bank of England indicates a significant decline in mortgage approvals for house purchases, reaching their lowest levels since December 2023. This downturn is particularly relevant for landlords and investors in the buy-to-let market, as it signals a shift in borrower sentiment and market dynamics.
What are the latest mortgage approval figures?
In May 2026, mortgage approvals for house purchases dropped by 15% compared to the previous month, totaling 56,200. This marks the lowest approval rate since December 2023. Additionally, net mortgage lending saw a significant decrease of 34%, falling from £4.4 billion in April to £2.9 billion in May. This figure is also below the six-month average of £5.1 billion, highlighting a concerning trend in the mortgage market.
How are remortgages affected?
Remortgage approvals experienced a similar downturn, plummeting by 34% from 51,200 in April to 33,300 in May. It’s important to note that this figure excludes product transfers, where borrowers remain with the same lender. This decline in remortgage activity reflects the broader trend of caution among homeowners and potential buyers.
What does this mean for buy-to-let investors?
The decline in mortgage approvals and net borrowing is particularly significant for buy-to-let investors. With average mortgage rates hitting 5% in April, up from 4% at the start of the year, many potential buyers are adopting a wait-and-see approach. This cautious sentiment could slow down property acquisitions, affecting rental supply and potentially impacting rental prices in the coming months.
What should landlords and borrowers watch next?
Landlords and borrowers should keep an eye on mortgage rate trends, as the outlook for the housing sales market in the second half of 2026 will depend on how far rates fall. If rates decline further, it could encourage more activity in the buy-to-let sector. Investors should also monitor economic indicators and housing market sentiment to make informed decisions regarding property investments.
Frequently asked questions
What is the current state of buy-to-let mortgage rates?
Buy-to-let mortgage rates have risen recently, reaching around 5% in April 2026. This increase has contributed to a decline in mortgage approvals as potential buyers reassess their financial commitments.
How can I assess my buy-to-let mortgage affordability?
To evaluate your buy-to-let mortgage affordability, you can use our BTL affordability calculator, which helps determine how much you can borrow based on your financial situation and rental income.