Landlords aren’t disappearing, they’re growing their portfolios

There has probably been more written about landlords leaving the PRS in the past couple of years than almost any other buy-to-let topic, and there is no question that some have decided the combination of higher costs, taxation and increased regulation means property investment is no longer for them.

However, I increasingly wonder whether concentrating quite so heavily on the number of landlords allegedly leaving risks missing a much bigger change taking place within the sector, because the latest figures from our own quarterly Rental Barometer suggest the landlord population is not simply contracting, but changing shape.

For instance, the average Fleet landlord now owns 18 investment properties, compared with 12 at the same point last year, representing a 50% increase in just 12 months and continuing a pattern of portfolio growth we have been seeing for some time.

A changing landlord population

Look further into the figures and that shift becomes even clearer, with landlords owning 15 or more properties now accounting for 30% of our applications, compared with 23% a year ago, while two-thirds of all applications received during Q3 came from landlords owning four or more properties.

At the other end of the scale, landlords with between one and three properties accounted for 24% of applications, down from 27% a year ago and 29% in Q2, which perhaps tells us something about where the centre of gravity within buy-to-let is moving.

There are some striking regional examples of this shift too. In the North East, 79% of applications during Q3 came from landlords with six or more properties, including exactly half from those with portfolios of 15-plus, while in the West Midlands almost two-thirds of applications were from landlords with six or more properties and 30% came from those with at least 15. This suggests the growth of larger, more professional portfolios is not confined to one particular part of the country, but is a feature we are seeing across very different regional markets.

I don't think we should interpret this as evidence that smaller landlords are disappearing altogether, because that’s patently not true, particularly because first-time landlord applications actually increased from 9% to 10% during Q3, but there is clearly an ongoing professionalisation of the sector as experienced landlords build increasingly substantial property businesses.

Perhaps, therefore, the more interesting question isn't simply whether landlords are leaving, but who is acquiring the properties and opportunities they leave behind?

Growing despite the headwinds

What makes these figures interesting is the environment in which this portfolio growth is taking place, because nobody could reasonably describe 2026 as an easy year for property investors.

Q3 brought another period of geopolitical uncertainty, volatile swap rates and changing mortgage pricing, while landlords have simultaneously been adapting to the Renters' Rights Act and preparing for the next stage of implementation, including the introduction of property registration.

We can see some of that uncertainty reflected in our own lending figures, with purchase business easing from 36% in Q2 to 34% in Q3 and average rental cover at origination falling from 144% to 132%. However, a slight quarterly reduction in purchasing is very different from landlords abandoning investment altogether, particularly when average portfolios continue to grow.

Professional landlords have become accustomed to assessing opportunities against a backdrop which rarely provides complete certainty, and increasingly their decisions appear to be less about whether they want to invest and more about when, where and at what price the numbers make sense.

The fundamentals still matter

Rental yields are obviously an important part of that calculation, and here the latest figures provide further encouragement, with the England and Wales average increasing from 7.5% to 7.9% year-on-year. Only two of the 10 regions covered by our Barometer recorded an annual decline in rental yield, while Yorkshire & Humberside moved to the top of the table at 9.3%, ahead of the North East at 9.2%.

That regional variation matters because professional landlords are not necessarily restricted to investing around the corner from where they live anymore, and the larger and more experienced they become, the more likely they are to assess opportunities on their individual merits, taking into account rents, yields, property values, tenant demand and financing costs.

What does this mean for advisers?

There is also an important advice story here because the needs of somebody operating an 18-property portfolio can be considerably different from those of a landlord owning one or two properties.

Financing decisions increasingly need to be considered across an entire portfolio, with ownership structure, leverage, rental cover, product fees, property type and future purchasing plans all potentially influencing which mortgage solution is appropriate.

That complexity should reinforce the value of specialist advice because, as the landlord population becomes increasingly professional, the financing supporting those businesses needs to keep pace.

We will undoubtedly continue to hear about landlords leaving the market, and for some individuals selling will be the right commercial decision, particularly as the regulatory and financial demands of providing rental property do increase. However, we should be careful about extrapolating from those individual decisions, a narrative that concludes landlords collectively have lost their appetite for buy-to-let.

Our latest figures suggest something rather different is happening because new landlords are still entering, experienced landlords are continuing to invest and the average portfolio is considerably larger than it was just 12 months ago. Landlords aren't disappearing, but the landlord of tomorrow may increasingly have a larger portfolio and a more professional approach than the landlord of yesterday. And that should be very good news for the advisers looking after them.