I want to set the tone from the start of this article as a celebration of what this part of the mortgage market has achieved, and if you can’t be a little self-congratulatory in one of the sector’s leading trade titles, where can you?

As one of the lenders that formed the launch panel for buy-to-let in September 1996, Paragon has been there from the start. We have seen the many highs and lows of the past 30 years, but we are proud of how this market has evolved into a mature, seasoned and established mortgage product.

Buy-to-let has grown to account for around a fifth of outstanding UK mortgage balances, with close to two million mortgages worth more than £300 billion. That is impressive.

It has also proven its status as a quality asset class, with arrears lower than the wider mortgage market in all but one year since records began.

Those figures alone make it an important part of the mortgage market, but its wider contribution is more significant still. I recently had the pleasure of spending time with John Heron, the first person to hold my role at Paragon and one of the architects of the buy-to-let market, and he reminded me of the problem buy-to-let was designed to address.

The UK had a clear housing need in the mid-90s. Demand for rented homes was increasing as the country emerged from a deep recession that left many people looking for housing quickly and letting agents were reporting tenants were queuing around the block.

The private rented sector at that point was small, underinvested and poorly served by existing finance. Landlords who wanted to invest generally had to rely on commercial mortgages, which were expensive, complex and poorly suited to residential property held over the long term.

A dedicated mortgage provided a more appropriate way to channel private investment into rented housing. It assessed the income a property could generate, its suitability for tenants and the landlord’s ability to manage the borrowing. That gave lenders a disciplined framework and landlords a legitimate route to finance.

The effect has been profound. In 1996, England had just under two million privately rented households, representing around one in ten households. Today, the sector accommodates close to five million households, or nearly a fifth of the total.

Buy-to-let finance has supported that expansion, enabling landlords to acquire, improve and maintain the homes needed by a changing population and society. It has helped accommodate growing student numbers, an increase in single-person households, greater labour mobility, inward migration and people buying their first home later in life.

This flexibility matters to the economy. A mobile workforce needs housing that allows people to move between towns and cities for new jobs without immediately committing to home ownership. Students need accommodation near universities. Families experiencing a change in circumstances need somewhere suitable to live, sometimes at short notice.

The sector also sustains a substantial network of employment and economic activity. Landlords use letting agents, brokers, surveyors, solicitors, accountants, builders and other tradespeople. They pay tax on rental income and property transactions, while their investment supports local businesses and the maintenance of the country’s housing stock.

Standards have improved alongside the growth of the market. The proportion of privately rented homes classed as non-decent has fallen markedly, while the energy efficiency of the sector has also strengthened. Responsible lending has played a part by requiring properties to be suitable for letting and capable of generating a sustainable rent.

The market has changed considerably since those early years. The rapid expansion of the early 2000s has given way to a more mature, regulated and professional sector. Larger and more experienced landlords now provide a growing share of rented homes, often operating through limited companies and applying a more structured approach to compliance, investment and portfolio management.

Buy-to-let was never intended to replace home ownership or social housing; of course Britain needs all forms of tenure to function effectively. Supporting first-time buyers and building more social and affordable housing should remain national priorities, but neither removes the need for a healthy private rented sector.

At 30, buy-to-let deserves to be recognised as a financial services success story. It created an effective funding model, helped reverse the long decline of private renting and supported millions of homes through repeated economic and political upheaval.

The industry should be proud of that record. Its task now is to ensure that buy-to-let’s fourth decade continues to support responsible investment, good-quality homes and a rental market capable of meeting the country’s ever changing housing needs.

Louisa Sedgwick is managing director of mortgages at Paragon Bank