First-time landlords are emerging as a dynamic force in the property market. With affordability pressures making homeownership increasingly difficult, many aspiring buyers are turning to buy-to-let as their first route onto the property ladder.
Several factors are driving this shift. Economic challenges such as high property prices, stagnant wages, and the broader cost-of-living crisis are leading some to reconsider their route into property ownership. For younger adults especially, the appeal of homeownership is being tempered by practical constraints. In fact, one in five are now considering moving abroad within the next five years in search of better job opportunities and lower living costs.
For those exploring options overseas, the ability to retain a foothold in the UK housing market is increasingly important. We are seeing more demand from expats looking to secure buy-to-let properties back home, as well as interest in holiday let investments that offer both lifestyle value and income potential. At Darlington Building Society, we support both of these routes, whether clients are purchasing a property for holiday letting or stepping onto the ladder from abroad.
Stamp duty changes are also playing a part. From April 2025, the threshold for first-time buyer relief dropped from £425,000 to £300,000. Buyers now pay 5% on any portion of their purchase between £300,001 and £500,000, even if it’s their only property. This narrowing benefit means some first-time buyers are looking at investment property instead, particularly in more affordable areas.
Unlike a residential purchase, a buy-to-let investment can be assessed based on its rental income. This can support mortgage affordability and offer more flexible lending options. In some cases, purchasing through a limited company may provide tax efficiencies and unlock better mortgage rates. While tax advice is essential, the buy-to-let route offers creative solutions for those struggling to buy a home to live in.
Opportunity in the rental market
The rental sector is continuing to expand, especially in commuter zones, university towns, and regeneration areas. Zoopla predicts rental inflation will average between 3 and 4% during 2025, though certain areas are seeing far sharper rises. For instance, rents in Blackburn are up by 10%, with similar growth in Stoke and Rochdale. These locations, where rents remain relatively affordable for tenants, are increasingly attractive to new landlords looking for solid yields and long-term demand.
Understanding the regulatory landscape
At the same time, the role of the landlord is evolving. The Renters Reform Bill, expected to pass this year, introduces sweeping changes to the private rental sector. One of the most significant updates is that all tenancies will become periodic, meaning landlords can only repossess a property with a valid reason such as rent arrears or a contract breach.
The bill also introduces higher standards for property condition and dispute resolution. New landlords must be aware of their responsibilities and ensure compliance with the updated legislation. Broker guidance is vital here, as is signposting clients to trusted organisations like the National Landlords Association or ARLA Propertymark, which offer expert information on best practice and legal obligations.
A flexible lending approach
Navigating the buy-to-let mortgage market can be a challenge for first-time investors. Some lenders are reluctant to approve applications without a proven track record of property investment. However, others take a more flexible view. At Darlington Building Society, we welcome first-time landlords and do not see them as inherently higher risk.
Many of these applicants are professionals with high incomes, who may already own property abroad or have consent to let on a UK home. Others work with letting agents, have secure tenancies in place, and are actively engaged in long-term planning. These are well-prepared clients who benefit from bespoke support and tailored products. This includes support for expats and holiday let investors, where a one-size-fits-all approach often falls short.
What sets Darlington apart is our focus on manual underwriting. We don’t rely on credit scores or rigid checklists. Instead, we assess each application individually, looking at projected rental income, the applicant’s overall financial position, and whether the investment is sustainable over time. Even those with complex or multiple income streams are considered, provided they can show a clear, viable plan.
A new type of investor
The boundaries between residential and investment ownership are becoming increasingly blurred. For some, investing in a rental property is now a more realistic option than buying a home to live in. Others are using buy-to-let to support retirement planning or diversify their income in an unpredictable job market. These clients tend to be financially literate, motivated, and diligent in their research, but they still need guidance from brokers and lenders who are open-minded and supportive.
Simultaneously, the buy-to-let sector is seeing reduced competition from veteran landlords, many of whom are exiting due to tax and regulatory changes. This creates space for new entrants, particularly those willing to invest in energy-efficient upgrades, maintain strong tenant relationships, and uphold high property standards. In return, they stand to benefit from reliable income and fewer void periods, especially in affordable, well-connected locations outside London.
Partnering for long-term success
For brokers, this shift presents a real opportunity. Many first-time landlords don’t initially view themselves as investors, but with the right advice and lender backing, they can successfully enter the market and grow a portfolio. It’s also a chance to forge valuable partnerships with lenders who are experienced in managing non-standard cases and focused on helping clients succeed.
We’re proud to support this new wave of landlords. By offering a flexible, case-by-case approach and prioritising individual circumstances, we’re helping turn ambition into long-term investment success.
