UK landlords optimistic amid rental market concerns

• Over three-quarters (79%) of landlords have expanded their portfolios in the last six months, despite market uncertainties. 
• One in four (25%) landlords plan to invest in an additional property within the next year, with one in five (20%) eyeing multiple investments.

Our survey of over 500 residential landlords in the UK, revealed that an impressive 79% have added to their property portfolios in the past six months. Additionally, one in four landlords (25%) expressed their intention to invest in an additional property within the coming year, with a significant 20% looking to diversify by purchasing multiple properties. These positive trends contribute to the overall health of the rental market in the UK.

A substantial proportion of those looking to expand their portfolios are exploring various strategies. Approximately 38% are seeking diversification by location, while 35% are actively exploring different types of residential properties. Furthermore, 25% of landlords are turning their attention towards student housing, and 20% are eyeing the retirement housing market. 

This research emerges against the backdrop of persisting concerns about the current rental market high demand and low supply in the UK's property rental market. Demand for rental homes is now 51% above the 5-year average, while the number of available homes is 30% lower than the average, as of September 2023. Additionally, fears have resurfaced regarding landlords selling rental properties due to rising mortgage costs, further compounding the challenges faced by the rental market. 

Our research, however, sheds light on a group of savvy professional landlords who are determined to invest and contribute quality rental properties to the property rental market. Among the 38% who are diversifying their property portfolios, nearly a third (31%) are doing so in response to tenant demand, while 28% are prioritising energy-efficient buildings. 

Furthermore, of the 79% of landlords planning to add at least one property to their portfolios, 32% are looking to capitalise on favourable market conditions, with 32% already having the necessary capital ready for investment. 

Emma Cox, Managing Director of Real Estate, said:

"While the property market remains challenging, it's encouraging to see professional landlords continuing to invest and seek opportunities to diversify. Our research has shown that a significant number of landlords have taken proactive steps to expand their portfolios while responding to demand to add quality, energy-efficient rental stock to the market for renters." 

She added, "Looking ahead, it will be important for buy-to-let landlords to explore external financing options and lean on specialist lenders. To continue meeting buyer needs in a sustainable way, astute landlords will need to keep thinking one step ahead, adapting their strategies to adjust to the rapidly changing real estate landscape." 

Despite the prevailing economic uncertainties, our research highlights the resilience and determination of professional landlords in the UK property rental market. Their continued investment and adaptability contribute to the overall stability of the rental market, providing valuable housing options for renters in the face of ongoing challenges.

_{The research was conducted by Censuswide in August 2023, surveying 1,012 UK landlords aged 18 and over.}