Landlords significantly increased remortgaging activity to fund improvements to their buy-to-let properties during 2025, with equity withdrawn for refurbishment work rising by 60% year-on-year, according to analysis by Paragon Bank.
The lender’s analysis of industry data found that landlords released £2.37 billion of equity through remortgaging for property improvements during 2025, compared with £1.48 billion in 2024.
The total was spread across 14,817 remortgage transactions, with landlords withdrawing an average of almost £43,000 per loan. This compares with 9,754 remortgages undertaken for the same purpose a year earlier.
Paragon said the increase in borrowing for property improvements coincided with growing attention on the Renters’ Rights Act, suggesting many landlords are investing in their portfolios to prepare for forthcoming requirements, including the proposed Decent Homes Standard.
The findings are consistent with previous research commissioned by the bank, which found that 44% of landlords actively seek out properties requiring improvement. On average, landlords spend £8,500 upgrading each property, with the most common works including installing new boilers, fitting kitchens and bathrooms, and addressing damp or structural issues.
Louisa Sedgwick, managing director of mortgages at Paragon Bank, said: “These figures reveal how landlords are strategically structuring their buy-to-let borrowing, leveraging the considerable amounts of equity they have built across their portfolios to finance property improvements.
“The timing of the increase in equity withdrawn for property improvements suggests that the Renters’ Rights Act is a driver, but landlords will also benefit from likely increases in the value of their investments and the additional appeal to tenants.”
Paragon also highlighted further refinancing opportunities for brokers, citing research undertaken by Pegasus Insight on its behalf showing that four in 10 landlords plan to refinance during 2026. Among landlords with portfolios of four or more properties, this rises to 57%.
The lender said upcoming Minimum Energy Efficiency Standards (MEES) requirements could create additional demand for finance as landlords seek to improve the energy performance of their properties and achieve EPC C ratings or above by 2030.
Sedgwick added: “Our earlier research revealed that almost six in 10 landlords don’t get their EPCs assessed after undertaking works to make their properties more energy efficient.
“Not only could this lead to ambiguity around compliance with any new MEES but could also mean that they’re missing out on preferentially priced green finance products.”
