Building a Buy-to-Let Portfolio in 2026: Where to Start
By Samuel Mather-Holgate
Key Buy-to-Let Takeaways (2026)
Expect to need 15–20% deposit for most buy-to-let mortgages
Stamp duty now includes a 5% surcharge on additional properties
Higher deposits generally produce stronger monthly cashflow
Lower deposits can help you scale a portfolio faster
SPV limited companies are often more efficient for multi-property portfolios
Always factor in fees, maintenance and voids, not just mortgage costs
A practical guide for investors in Swindon, Cirencester and Bristol
For many people, building a buy-to-let portfolio is one of the most attractive ways to create long-term wealth and income.
But the hardest part is often the beginning.
How much deposit do you really need?
Should you buy personally or through a limited company?
What costs catch people out?
And how much income is actually left once the mortgage, stamp duty and running costs are taken into account?
As a mortgage adviser in Swindon, Cirencester and Bristol, we help clients answer these questions before they make expensive mistakes.
This guide is aimed at someone who wants to start building a portfolio but doesn’t yet know the best structure or where to begin.
Start with the Numbers: A £150,000 Buy-to-Let Example
To make this practical, let’s assume:
Purchase price: £150,000
Monthly rent: £900
Mortgage type: interest-only
Term: 25 years
We’ll compare two common approaches:
Option 1: 20% deposit (80% LTV)
Option 2: 15% deposit (85% LTV)
Both have their place — but they lead to very different outcomes.
Option 1: 20% Deposit (80% LTV)
This is the more conservative route and usually gives you:
a lower rate
better cashflow
more lender choice
a slightly easier underwriting process
Example figures
Purchase price: £150,000
Deposit (20%): £30,000
Mortgage loan: £120,000
Rate: 5.27% fixed
Monthly interest-only payment: £527.00
If the rate later reverted to 8.09%
Monthly payment would rise to: £809.00
Option 1: Upfront Costs
Deposit
£30,000
Stamp Duty
Buy-to-let purchases now pay the standard residential SDLT rates plus a 5% surcharge. On a £150,000 purchase, that works out as:
5% on the first £125,000 = £6,250
7% on the next £25,000 = £1,750
Total SDLT = £8,000
Other costs
Using the same fee profile as your Birmingham Midshires illustration:
Broker fee: £795
Valuation fee: £100
Legal fees: allow £1,200 to £1,500
Total cash needed up front
Deposit: £30,000
SDLT: £8,000
Broker fee: £795
Valuation: £100
Legal fees: £1,200 to £1,500
Total upfront cash required: approximately £40,000
Option 1: Income and Expenditure
Let’s assume:
Rent: £900 pcm
Mortgage: £527 pcm
Management / maintenance / insurance provision: £150 pcm
That gives:
Gross monthly income: £900
Mortgage payment: £527
Estimated running costs: £150
Estimated surplus before tax and voids: £223 pcm
That is a solid starting point. It gives breathing room for repairs, void periods or rate movement later on.
Option 2: 15% Deposit (85% LTV)
This is the more aggressive option.
It lowers the upfront cash you need and can help you buy sooner or preserve capital for your second property — but it also means:
higher rates
tighter monthly cashflow
less room for error
Example figures
Purchase price: £150,000
Deposit (15%): £22,500
Base mortgage loan: £127,500
Product fee added to loan: £3,060
Total mortgage balance: £130,560
Rate: 5.76% fixed
Monthly interest-only payment: £626.69
If the rate later reverted to 8.64%
Monthly payment would rise to: £940.03
Option 2: Upfront Costs
Deposit
£22,500
Stamp Duty
Exactly the same SDLT applies:
£8,000 total on a £150,000 additional property purchase
Other costs
Using the fee structure from your Vida illustration:
Broker fee: £795
Valuation fee: £230
Assessment fee: £195
Funds transfer fee: £35
Legal fees: allow £1,200 to £1,500
Product fee: £3,060 added to the mortgage, not paid separately up front
Total cash needed up front
Deposit: £22,500
SDLT: £8,000
Broker fee: £795
Valuation fee: £230
Assessment fee: £195
Funds transfer fee: £35
Legal fees: £1,200 to £1,500
Total upfront cash required: approximately £33,000
That’s around £7,000 less cash up front than the 20% route — but there is a trade-off.
Option 2: Income and Expenditure
Using the same rent and running costs:
Rent: £900 pcm
Mortgage: £626.69 pcm
Management / maintenance / insurance provision: £150 pcm
That gives:
Gross monthly income: £900
Mortgage payment: £626.69
Estimated running costs: £150
Estimated surplus before tax and voids: £123.31 pcm
So yes, you get into the market with less cash — but your monthly margin is almost £100 lower than the 20% route.
15% vs 20% Deposit: Which Is Better?
20% deposit
This is usually better if your priority is:
stronger monthly cashflow
lower risk
better resilience if rates rise
easier affordability for the next purchase
15% deposit
This is often better if your priority is:
buying sooner
preserving capital
scaling more quickly
building a portfolio faster
My honest view
If you are buying one property, the 20% deposit route is generally more comfortable.
If you are trying to build a larger portfolio, the 15% deposit route can make sense — but only if you have the right structure, the right lender and the right long-term plan.
Should You Use an SPV Limited Company?
For anyone serious about building a portfolio, this is one of the most important decisions you will make.
An SPV (Special Purpose Vehicle) is a limited company created purely to hold investment properties.
For many portfolio landlords, this is now the preferred structure.
Advantages of Using an SPV for Buy-to-Let
1. Mortgage interest is fully deductible
This is the big one.
For personally owned buy-to-lets, tax relief on mortgage interest has been restricted for years. Inside a limited company, the interest is still treated as a business expense.
For higher-rate taxpayers, that can make a huge difference.
2. Easier to reinvest profits
If your goal is to build a portfolio rather than live off the first property’s income, a company structure often makes that easier.
3. Cleaner structure for multiple properties
Once you start holding several properties, an SPV can be easier to manage and often easier to present to lenders.
4. Better long-term planning
For serious portfolio landlords, company ownership is usually easier to align with future acquisitions, retained profit and structured growth.
Disadvantages of Using an SPV
1. Mortgage rates can be a little higher
Company buy-to-let lending is well established now, but it can still be slightly more expensive than personal borrowing.
2. More admin
You’ll need:
annual accounts
a company return
usually an accountant
3. Extra professional costs
There can be setup costs and ongoing advice costs.
So Is an SPV Worth It?
If you’re buying one buy-to-let and just want some extra income?
Buying personally can still work.
If you want to build a larger portfolio?
In most cases, yes — an SPV is the better route.
That doesn’t mean every investor should use one automatically. But for anyone planning to buy multiple properties, retain profits and grow over time, it is usually the most sensible structure.
What New Investors Underestimate
The biggest mistake people make is not the mortgage.
It’s underestimating everything around it:
Stamp duty
legal fees
broker fees
product fees
maintenance
insurance
void periods
tax structure
A buy-to-let can look fantastic on paper if you ignore half the costs.
That’s why proper mortgage advice in Swindon, Cirencester and Bristol matters so much.
Why a Mortgage Adviser Matters for Buy-to-Let
Buy-to-let mortgages are not just residential mortgages with a tenant in them.
They are assessed differently.
Lenders vary on:
rental stress tests
SPV lending rules
portfolio landlord treatment
minimum income requirements
property type
acceptable deposit levels
The wrong lender can waste time, money and opportunities.
The right adviser helps you:
structure the deal properly
compare the real costs
plan for future purchases
avoid mistakes that block future growth
Final Thoughts
Buy-to-let can still be a very effective long-term strategy.
But if you want to build a portfolio rather than just buy a single property, you need to think beyond the first purchase.
The real decisions are:
15% or 20% deposit?
Personal name or SPV?
Cashflow now or growth later?
One property or a portfolio?
If your aim is to build something meaningful over time, then in most cases:
an SPV limited company is the better structure for a growing buy-to-let portfolio
And if you want mortgage advice in Swindon, Cirencester or Bristol, getting that structure right from the start can save a huge amount of money and hassle later on.
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