£50k Gift: Buy-to-Let Investment for First-Time Buyers
First-time buyer landlords are on the rise, choosing buy-to-let investments over traditional homeownership, and this trend is fueled by a desire for multiple income streams. Matthew Small, a 29-year-old, plans to use a £50,000 gift to kickstart his property portfolio—a smart move. Estate agents report a surge in first-time landlord applications, highlighting the appeal of this secondary income, as underscored in News directory 3’s coverage. Many young adults are opting for buy-to-let to afford property sooner and build long-term financial security. Prospective landlords are considering flats and terraced houses in affordable areas to capitalize on strong rental demand. But, securing a mortgage can be tough.
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First-Time Buyers Forego Homeownership, Opt for Buy-to-Let Property Investment
Updated may 28, 2025
A growing number of young adults are becoming first-time landlords, choosing to invest in buy-to-let properties rather than purchasing homes to live in. matthew Small,a 29-year-old video game developer from Wembley,plans to join this trend,using a £50,000 gift from his parents as a deposit for an investment property.
Small intends to continue living with his parents while building a property portfolio. He said purchasing a buy-to-let will provide a secondary income stream. Unlike his siblings, who used similar gifts to buy their own homes, Small is focused on long-term financial security through multiple income streams.
Estate agents and mortgage lenders confirm the rise in first-time buyer landlords. Buckinghamshire Building Society reported a 20% increase in first-time landlord applications since last year. Claire Askham, head of mortgage sales at Buckinghamshire BS, noted this trend reflects a desire to build multiple income streams early in life.
Liam Gretton, a Wirral-based estate agency owner, said many first-time buyers in their late 20s and early 30s are choosing the landlord route as they cannot afford their ideal homes. Buy-to-let allows them to invest now and potentially use the income toward a future home.
These buyers frequently enough seek flats or terraced houses in areas like Merseyside, Manchester, and Preston, where property is more affordable and rental demand is strong. Properties near shops, transport, and schools are notably popular.
Foundation Home Loans reported that first-time landlord applications increased from 21% in 2024 to 24% in the first four months of this year.
However, securing a mortgage as a first-time buyer landlord can be challenging.Lenders are wary of “back-door residential mortgages,” where borrowers falsely claim they will rent out a property they intend to live in.
Small is considering investment opportunities in Aylesbury, Buckinghamshire, and Newcastle. He plans to assess average yields in potential areas to determine property values and intends to hire a managing agent to handle the property.
Small plans to use the Buy, refurbish, Refinance, and Rent (BRRR) strategy, adding value to properties through renovations before remortgaging and renting them out.
Gretton cautions first-time buyers to avoid underestimating costs, including maintenance, certificates, and potential licensing fees. He also warned that high rental returns in areas with poor demand or crime issues can be more trouble than they are worth.
What’s next
Small aims to secure his financial future through property investment, with plans to acquire multiple buy-to-let properties over time.