Higher mortgage rates force landlords to adapt: Hamptons

by Aaron Strutt

Apr 14 2026

Higher mortgage rates are forcing landlords to adapt by taking more interest-only mortgages, cash injections and shorter fixed mortgages. This is according to Hamptons’ analysis of Connells Group data.

By early April, 43% of all new buy-to-let lending was agreed at rates of 5% or above, up from just 8% in January. In response to higher borrowing costs, three-quarters (78.4%) of landlords are moving towards interest-only mortgages, up from 71.1% in January 2026.

Four in ten (40%) landlords remortgaging on interest-only deals injected cash, paying down an average of £30,100 to access more competitively priced buy-to-let rates.

The annual pace of rental growth on newly let homes accelerated in March, with rents up by 1.0% across Great Britain, driven by a 4.1% uplift in Inner London.

What is happening in the buy-to-let market?

Buy-to-let landlords are under pressure from multiple angles at the moment, especially newer landlords with smaller property portfolios and less equity in their properties. 

Mortgage costs have risen, and while they remain elevated, compliance costs are increasing and rental growth is no longer as reliable across the market. Many of the buy-to-lets our brokers arrange are often done through limited companies.

How are landlords lowering their monthly costs?

One of the main ways landlords are trying to cut costs is by reviewing their mortgages more actively. Rather than simply allowing a deal to expire and stay on their lender’s standard variable rate, many are refinancing, remortgaging or choosing product transfers to keep costs under control.

Do landlords really have to pay 5%?

No, not all landlords need to pay rates as high as 5%. Some lenders are still offering pretty good buy-to-let rates, even if they have higher setup fees. For example, BM Solutions has two-year fixes around 3.75% and five-year fixes around 4.5, both rates have 3% arrangement fees. Other lenders have slightly higher rates with lower fees, and there are cheaper deals for energy-efficient homes. 

The Mortgage Works has a one-year fix at just over 3.3% with a 2% arrangement fee for landlords with a 25% deposit, and it also has very low exit fees. Its two-year trackers start from around 3.50% with 3% fees.

These high-fee and low-rate mortgages give landlords some breathing space, especially if the rental income is tight, they need to remortgage to take out cash, or they are reassessing their options and weighing up whether to exit the property market.

Speak to a Trinity Financial adviser today

The mortgage market moves fast — and the right advice can make a significant difference to the rate and deal you secure. Get in touch with our team to discuss your options.

Call Trinity Financial on 020 7016 0790 to secure a fixed or tracker rate mortgage, book a consultation, or use our appointment calendar

The information contained within was correct at the time of publication but is subject to change. It is for general information purposes and is not advice.

The Financial Conduct Authority does not regulate most Buy to Let Mortgages

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