Paragon’s gross buy-to-let mortgage lending fell 4.7 percent year on year to £773.7 million in the six months to 31 March, as the specialist lender said some borrowers held back ahead of last autumn’s Budget.
The lender also cut its lending outlook for the full 2026 financial year, saying mortgage volumes are now expected to come in at the lower end of its previous £1.5 billion to £1.7 billion range. That points to a more cautious market even though pipeline figures improved.
For landlords, the figures matter because Paragon is one of the clearest read-across lenders for specialist buy-to-let demand. When a major lender reports weaker new business but a firmer pipeline, it suggests landlords are still active, but are taking longer to commit and are watching tax, rates and market direction more closely.
Buy-to-let lending slips as landlords stay cautious
In its latest half-year results, Paragon said lower buy-to-let lending partly reflected borrower nervousness around the potential impact of the November 2025 Budget on their businesses.
The bank’s mortgage loan book still grew 2.9 percent to £14.1 billion, helped by retention and repeat borrowing. Paragon said £293 million of new lending in the half – more than one third of the total – came from existing customers with at least one live account.
That matters for landlords because it suggests experienced borrowers are still refinancing and restructuring, even if fewer are pushing ahead with fresh expansion. Landlord Knowledge recently reported that landlords are prioritising certainty as buy-to-let confidence weakens, and Paragon’s update fits that pattern.
Mortgage pipeline rises but full-year outlook is trimmed
There was a stronger signal beneath the headline fall in completed lending. Paragon’s closing mortgage pipeline rose 8.6 percent year on year to £718.9 million, showing applications and agreed business are still building.
But the lender still lowered its 2026 expectations to the bottom of its previous range, which points to slower conversion from enquiry to completion. That can happen when landlords delay purchases, review portfolio numbers more carefully, or wait for a clearer rate path.
This follows Landlord Knowledge’s report on rising mortgage approvals but cooler borrowing in April, which showed activity returning without a full revival in borrowing momentum. Paragon’s latest figures suggest that split is still in place in the specialist landlord market.
Why the wider results still matter to landlords
Paragon’s wider half-year figures were steady rather than strong. Underlying profit before tax slipped to £145.7 million from £149.4 million, while net interest margin narrowed to 3.08 percent from 3.13 percent. Statutory profit before tax also fell 5 percent to £133.2 million.
That is a reminder that specialist lenders are still operating in a competitive market where pricing pressure remains strong. For landlords, that can be helpful in the short term if lenders keep competing on product and retention pricing. But weaker margins also leave less room for aggressive cuts if funding conditions turn again.
A more encouraging sign was the bank’s continued focus on existing borrowers and higher-EPC properties. Paragon said EPC A-C homes made up 56.4 percent of first-half buy-to-let lending, which keeps energy standards tied closely to mortgage availability and pricing.
What this means for landlords
- If you’re refinancing this year: lenders still want established landlord business, but appetite looks more selective than raw pipeline growth suggests.
- Watch for: whether stronger application pipelines at specialist lenders turn into completions over the summer, or whether Budget and rate concerns keep deals stalling.
- Bottom line: landlord borrowing has not dried up, but Paragon’s results show caution is still shaping the buy-to-let finance market.
Editor’s view
Pipeline growth is the interesting number here, not the lending drop on its own. Landlords are still in the market, but they are moving with far less conviction than lenders would like.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 3 June 2026
Sources: Paragon Banking Group half-year results, Mortgage Solutions
Related reading: Landbay says landlords seek certainty as buy-to-let confidence falters
