How and why brokers should respond to the rise in young property investors

    Paul Huxter - Head of Intermediary Sales and Distribution

Property investment appetite is growing among young people in the UK, as the number of landlords under 30 keep rising. Across the UK, there are about 66,000 landlords under the age of 30, with 3,000 of these coming in under the age of 21.

While most landlords are still over 50, we seem to be witnessing a gradual generational shift towards rental property as a long-term wealth-building strategy. In fact, many young investors are even prioritising property investment over homeownership or traditional savings, instead looking for stable returns and greater financial security in a shaky economic environment.

This is supported by average yields that range from around 6% to 9%, with regional variation. According to recent data, the North East is the strongest region in the UK, delivering average yields of 9.2%. The North West follows at 8.4% and Yorkshire & Humberside at 8.1%.

These trends highlight opportunities for first-time landlords looking for a rental property investment that can deliver regular income along with capital appreciation.

Challenges with High Street Lenders

Many young investors are uninitiated in the property landscape. Before speaking to a mortgage broker or financial adviser they’re probably looking to get a high street mortgage. The only problem? Traditional high street lenders have stringent criteria that complicate buy-to-let property purchases for first-time landlords (and especially younger investors).

Beyond the reluctance of many mainstream banks to lend to those without prior landlord experience, younger would-be-landlords are also more likely to have limited credit history, variable income sources, or even be first-time buyers. This reluctance creates a funding gap that specialist lenders like West One, who have more leeway in their lending criteria for younger buyers, can fill.

Brokers and specialist lenders fill the gaps

Specialist lenders are flexible and pragmatic in their approach to underwriting and are more likely to consider unique borrower circumstances, such as variable income, limited experience, or non-traditional employment. By offering more flexible Debt Service Cover Ratios (DSCR), longer terms and higher LTVs, it lays the foundations of a long investment journey. 

Many young investors might find that specialist lenders aren’t an alternative to the high street, but rather, the only viable route into the buy-to-let market.

Young investors are motivated by both financial returns and the desire to align investments with their values and goals. This presents an opportunity for brokers to validate this enthusiasm while grounding it in financial reality, providing a suite of specialist lending options for that first step into the rental property market.

Ultimately, by affirming the ambitions of young investors and offering practical solutions, brokers foster a relationship of trust. The brokers who help new entrants navigate the complexities of the rental property market and support their buy-to-let ownership journey are the ones who will see the best results from this demographic.

Building Lifelong Client Relationships

Brokers who provide validation and tailored support do a lot more than facilitate a first rental property purchase; they build the groundwork for long-term relationships with the property investors of the future. Young investors who feel heard, empowered, and well-advised are far more likely to return to the same broker for future property purchases, remortgages, or portfolio expansions.

As these clients’ needs evolve and personal circumstances change, brokers who have established trust and demonstrated expertise become their go-to advisors. By acting in this capacity, a virtuous circle is created: brokers help clients make informed financial decisions, and satisfied clients become advocates, referring friends and family, which further emboldens the reputation of the broker.

In this way, the initial act of validation and guidance doesn’t just open the door to property investment for young people, it often marks the beginning of a lifelong professional partnership.