Buy-to-Let Purchase Checklist 2026

Buy-to-let in the UK is a regulated commercial activity, not a retail purchase. The post-2016 regulatory load (Section 24, 5% SDLT surcharge, EPC C requirement looming, Renters' Rights Act) means this checklist matters more than it did a decade ago.

1. Section 24 tax modelling

Section 24 phased out full mortgage interest deduction by April 2020; landlords now get a 20% basic-rate tax credit instead. For a higher-rate (40%) taxpayer on a £12,000 rental income with £6,000 interest, the effective tax bill went from £2,400 to £3,600, a £1,200/year hit. Model your post-Section-24 net income at your actual tax rate before assuming the headline yield works.

2. BTL Stamp Duty surcharge

Additional property (BTL, second home, holiday let) pays standard SDLT plus a 5% surcharge on the full purchase price. On a £300,000 purchase that's £20,000 versus £5,000 for a single-residential buyer. Use our calculator for the exact figure.

3. Gross vs net yield

Gross yield = annual rent / purchase price. Net yield deducts management (typically 10%), maintenance (1% of value), insurance, ground rent/service charge if leasehold, and void allowance (1 month per year). A 7% gross typically becomes 4-5% net.

4. Rental demand sense-check

Use our yield calculator and check the local average time-on-market for rentals. Markets with rentals taking 3+ weeks to let suggest demand softness or rental over-supply.

5. HMO licensing

If you plan to let to 3+ unrelated tenants forming 2+ households, you may need a licence. Three regimes: Mandatory (5+ tenants in 3+ storey buildings, England-wide), Additional (local-authority specific), Selective (location-based). London boroughs particularly aggressive on Selective Licensing.

6. Renters' Rights Act compliance

The Renters' Rights Act took effect May 2026. Section 21 (no-fault) evictions are gone. Every existing tenant must receive the official Information Sheet (£7,000 fine for non-compliance). All tenancies are now periodic month-to-month. Possession only via Section 8 grounds, including the new Ground 1A for selling the property.

7. EPC C requirement

From 2030 (currently proposed), new tenancies will require an EPC C or better. Existing tenancies have until 2032. If you're buying today at EPC D or worse, factor the upgrade cost into your offer.

8. Mortgage product comparison

BTL mortgages typically need 25% deposit, run interest-only on a 75% LTV, and apply a rental coverage ratio (typically 145% for higher-rate taxpayers). Compare across at least three brokers; rate spreads between lenders are wider than residential.

9. Exit strategy

BTL is a long-hold commercial investment in current tax/regulatory regime. Consider: which buyer pool buys this property when you sell (another investor? owner-occupier?) and at what price multiple of rent? Properties that only appeal to other investors have weaker liquidity than properties that also work for owner-occupiers.