Changes to stress testing rules have helped open up the buy-to-let (BTL) mortgage market, research from mortgage adviser Alexander Hall found.
Lenders can now assess affordability more flexibly after the Bank of England update in March 2025, which removed the old rule that fixed-rate products of less than five years had to be stress tested at the standard variable rate plus 1%.
The number of BTL mortgage products between January and June 2025 rose to 2,752, up 41.9% on the same period last year.
This was the biggest increase across all borrower groups.
First-time buyer (FTB) products went up by 16.2%, while remortgaging products rose 3.2% and home mover products by 2.0%.
The typical 2-year fixed BTL mortgage at 75% loan-to-value (LTV) fell from 4.78% in May 2023 to 3.93% in May 2025, a drop of 0.85 percentage points in two years and 0.61 in the last year.
Some lenders have even launched sub-3% rates, making the sector more attractive for landlords.
These changes are expected to lead to more investment in BTL, especially among portfolio landlords and professional investors who were most affected by tougher affordability rules.
Richard Merret, managing director at Alexander Hall, said: “The easing of stress testing rules is an important step forward for the buy-to-let sector.
“We’ve already seen a noticeable improvement in product availability and borrowing affordability, helping landlords better manage their portfolios and capitalise on new opportunities.
At a time when the rental market is under pressure from high demand and low supply, these changes offer a much-needed boost to investor confidence and market fluidity.”
