Recent analysis reveals a significant surge in equity release among landlords, with a 60% increase in remortgaging to fund property improvements. This trend highlights how landlords are strategically using the equity built in their portfolios to enhance their buy-to-let properties, which is important for maintaining competitiveness in the evolving mortgage market.
TL;DR: Landlords withdrew £2.37 billion in equity through remortgaging in 2025, a 60% increase from the previous year; this trend is reshaping the buy-to-let market as landlords invest in property upgrades.
Why Are Landlords Increasing Remortgaging?
According to Paragon Bank’s analysis, landlords withdrew £2.37 billion for property improvements in 2025, up from £1.48 billion in 2024. This increase was driven by 14,817 remortgages, with an average loan amount of nearly £43,000. The data indicates that many landlords are focusing on properties needing upgrades, with 44% actively targeting such homes and spending an average of £8,500 on improvements like new boilers and kitchen renovations.
How Will Upcoming Regulations Impact Landlords?
With new Minimum Energy Efficiency Standards (MEES) regulations set to take effect, landlords are under pressure to ensure their properties meet EPC C or above by 2030. This regulatory push is likely to drive further remortgaging as landlords seek funds for energy efficiency upgrades. Notably, 57% of landlords with four or more properties plan to refinance this year, presenting opportunities for mortgage brokers.
What This Means for the Mortgage Market
The rising trend in equity release signifies a strategic shift for landlords, enabling them to enhance property value and comply with new regulations. Brokers should prepare for increased demand as landlords look to refinance and fund necessary upgrades. Additionally, many landlords may not be aware of the importance of having their EPCs assessed after making energy-efficient improvements, which could affect their compliance with upcoming regulations.
Frequently Asked Questions
What types of improvements are landlords making with equity release?
Landlords are primarily investing in essential upgrades such as new boilers, kitchens, and bathrooms, as well as addressing damp and structural issues.
How can brokers assist landlords in this changing market?
Brokers can help landlords navigate refinancing options and ensure they are aware of regulatory requirements, particularly regarding energy efficiency standards.