Can First Time Buyers Get a Buy to Let Mortgage in Devon?
Buying a rental property before buying a home to live in sounds like a shortcut. Skip the emotional search for the perfect kitchen, let the rent cover the mortgage, and build equity while still renting yourself.
It is a genuine strategy, and lenders will consider it. But being a first time buyer changes the numbers in ways that catch a lot of people out, particularly in a market like Devon where average rents do not always stretch as far as the deposit calculators suggest.
This piece works through the criteria lenders apply, what it costs in stamp duty, and whether the sums add up on a typical Devon property.
Key Takeaways
- Most buy to let lenders ask for a 25 percent deposit, with some accepting 20 percent at a higher rate.
- Rental income must clear an interest cover ratio, typically 125 to 145 percent of a stressed mortgage payment.
- A genuine first time buyer owning no other property does not pay the additional dwelling stamp duty surcharge.
- Exeter's average rent of £1,317 a month falls short of the stress test on an average priced home at 75 percent LTV.
- A bigger deposit, often close to 40 to 45 percent, is usually what makes the rental cover test pass at average prices.
So, Can You Actually Get One?
Yes. A number of specialist lenders will accept applicants who have never owned a home, though the pool is smaller than for experienced landlords and the underwriting tends to be stricter on both income and the property itself.
The property still has to earn its keep. Lenders assess a buy to let mortgage primarily against the rent the property can achieve, not your salary, which means the deal has to make sense as a business proposition before your personal finances even come into it.
Most lenders also want to see a minimum personal income, commonly around £25,000 a year, as a safety net for void periods or unexpected repairs. It is a backstop rather than the main test, but it rules out a handful of applicants before the property numbers are even considered.
Credit history carries more weight than many first time applicants expect too. A clean record widens the field of lenders willing to consider you, while missed payments or heavy existing debt can push the required deposit up even further than the numbers below suggest.
What Lenders Actually Ask For
Four things determine whether an application gets approved, and all four need to line up together.
|
Requirement |
Typical Figure |
Notes |
|---|---|---|
|
Deposit |
25% (some at 20%) |
Larger deposits ease the rental cover test |
|
Personal income |
£25,000+ a year |
Varies by lender, some have no formal floor |
|
Rental cover (ICR) |
125% to 145% |
Higher for additional rate taxpayers or limited companies |
|
Stress test rate |
5% to 6% |
Notional rate, not the actual mortgage rate |
The rental cover test is the one that trips up most first time applicants. Full detail on how lenders assess it sits in MoneyHelper's guide to buy to let mortgages explained, which is worth reading before speaking to a broker.
|
Worth Knowing: Some lenders decline first time buyers outright for buy to let, regardless of deposit size. A broker who knows the first time landlord market saves a lot of wasted applications. |
Running the Numbers on a Devon Property
Exeter makes a useful test case, since it sits close to the Devon average and has solid, recent official data behind it.
- Average house price in Exeter: £339,000, based on the latest Land Registry sold price data
- Average monthly private rent in Exeter: £1,317, according to the Office for National Statistics
- That works out to a gross rental yield of roughly 4.7 percent before any costs
- The wider South West average rent sits close to £1,237 a month, slightly below the Exeter figure
Why the Deposit Often Needs to Be Bigger
Run Exeter's averages through a standard 145 percent interest cover test at a 5.5 percent stress rate and the numbers get tight quickly.
|
Deposit / LTV |
Loan Amount |
Monthly Rent Needed |
Passes on £1,317 Rent? |
|---|---|---|---|
|
25% deposit (75% LTV) |
£254,250 |
£1,690 |
No |
|
40% deposit (60% LTV) |
£203,400 |
£1,352 |
No, marginal |
|
45% deposit (55% LTV) |
£186,450 |
£1,239 |
Yes |
Exeter average house price versus the deposit needed to pass a typical rental stress test.
At the standard 25 percent deposit, Exeter's average rent falls well short of what the stress test demands. It takes a deposit closer to 45 percent, well above the usual minimum, before the average property clears the bar on its own.
"The rent required to pass a standard stress test on Exeter's typical home is close to £1,700 a month, well above the actual local average of £1,317."
None of this rules out buy to let for a new investor. It simply means the maths often works better on a cheaper property, a higher yielding area, or with a larger deposit than the lender's stated minimum. A broker who runs these numbers before an offer is made can save weeks of wasted paperwork.
The Stamp Duty Question Most Guides Get Wrong
A lot of first time buyer buy to let content states flatly that the additional property surcharge always applies. That is not quite right.
HMRC's own higher rates of Stamp Duty guidance is clear on this point: the higher rates apply when the new purchase will not be the only residential property you own anywhere in the world. Someone buying their first and only home, even if it is let out rather than lived in, does not own two properties at completion, so the surcharge does not apply.
|
Scenario |
SDLT on £339,000 Purchase |
|---|---|
|
First time buyer, sole property (standard rates) |
£6,950 |
|
Buyer who already owns a home (additional property rates) |
£23,900 |
Stamp Duty comparison on a £339,000 Exeter purchase.
What a first time buyer does miss out on is first time buyer relief itself, since that only applies to a property you intend to live in. The consolation is avoiding a surcharge that catches out most other second property buyers.
Making the Numbers Work
None of the figures above are a reason to abandon the idea. They point instead towards being realistic about which properties and areas actually make the numbers work.
- Look outside Exeter itself, since smaller Devon towns often carry lower prices without a proportionate drop in achievable rent
- Get a mortgage broker to run the rental cover test before you make an offer, not after
- Factor in letting agent fees, landlord insurance and maintenance before assuming the numbers work
- Consider a smaller flat or a property needing modest cosmetic work, since both tend to carry a lower entry price without sacrificing much rent
Our earlier renting versus buying comparison covers some of the same ground from the tenant's side, and is worth reading if you are weighing this against simply renting for longer yourself.
Once you do own a rental property, our guide to landlord insurance guide explains why a standard homeowner policy will not cover you and what to look for instead.
|
Watch: The Ultimate Guide To Buy-To-Let Mortgages In 2026 This video runs through the wider buy to let mortgage landscape for 2026, including how lenders assess applications from new landlords. |
If the First Property Route Feels Like a Stretch
Buy to let is not the only route into property investment, and for some first time buyers a different order of operations suits them better.
Anyone weighing up development or renovation projects instead might find our guide to becoming a property developer in Devon a useful next read, and our wider Homes & Gardens coverage covers plenty more on the practical side of owning and letting property in the county.
Frequently Asked Questions
Can someone with no property history get a lender to approve buy to let?
Yes, though fewer lenders offer this than to experienced landlords. Expect closer scrutiny of your income, credit history and the property's rental potential than an established landlord would face.
Do first time buyers pay the extra stamp duty surcharge on buy to let?
Not if that purchase is genuinely your only property. The additional dwelling surcharge only applies when you own two or more residential properties at completion.
What deposit do I need for a first buy to let property?
Lenders typically ask for 25 percent as a minimum, though passing the rental cover test at average UK property prices often means putting down closer to 35 to 45 percent.
What is an interest cover ratio and why does it matter?
It is the ratio between the rent a property earns and the mortgage interest payment, tested at a stressed rate. Most lenders require rent to reach 125 to 145 percent of that stressed payment before approving a loan.
Is buy to let a good way to get onto the property ladder?
It can work, but the property needs to perform as an investment in its own right. Treat the rental income and costs as the main test, not a bonus on top of your own homeownership plans.
Are Devon rental yields strong enough for first time landlords?
Yields around Exeter average close to 4.7 percent gross, broadly average for the UK. Smaller Devon towns and more affordable property types can offer stronger yields for a similar deposit.
Final Thoughts
Buy to let as a first purchase is achievable in Devon, but the deposit needed to actually clear a lender's rental cover test often sits well above the headline 25 percent figure quoted everywhere. Run the numbers on the specific property before committing to the idea, and the stamp duty position at least favours a genuine sole property owner, even if the mortgage criteria do not always feel that generous.
References
GOV.UK, Higher Rates of Stamp Duty Land Tax, updated 2026 — https://www.gov.uk/guidance/stamp-duty-land-tax-buying-an-additional-residential-property
MoneyHelper, Buy to Let Mortgages Explained, 2026 — https://www.moneyhelper.org.uk/en/homes/buying-a-home/buy-to-let-mortgages-explained
Office for National Statistics, House Prices in Exeter, 2026 — https://www.ons.gov.uk/visualisations/housingpriceslocal/E07000041/
Rightmove / HM Land Registry, House Prices in Exeter, 2026 — https://www.rightmove.co.uk/house-prices/exeter.html
HM Revenue & Customs, Stamp Duty Land Tax Relief for First Time Buyers — https://www.gov.uk/stamp-duty-land-tax/relief-for-first-time-buyers
Fact Check: All statistics and data points in this article were verified against original sources as of 11 August 2026. Sources are listed in the References section.
