Landlords now 8x more likely to reduce portfolios than expand

Property118

Landlords now 8x more likely to reduce portfolios than expand

A clear shift is emerging in the UK private rented sector, and it is not subtle. According to the Property118 Landlord Sentiment Survey Q1 2026, landlords are now significantly more likely to reduce their portfolios than grow them, pointing to a structural change in the direction of the market.

Based on 2,380 completed responses, covering a combined total of 23,098 rental properties, the survey provides one of the most detailed real-time snapshots of landlord behaviour currently available. You can read the full survey results here.

The headline figure is stark: 57% of landlords say they plan to reduce their portfolios over the next 12 months, compared with just 6.8% who intend to expand. That makes landlords more than eight times as likely to sell than to buy.

This is not a marginal imbalance; it is a decisive shift.

A market moving in one direction

At a surface level, the figures might suggest a cooling market, but the reality is more significant. When more than half of landlords are planning to reduce exposure, and fewer than one in fourteen are looking to grow, the direction of travel becomes difficult to ignore. This is not a market in equilibrium; it is a market contracting.

As the survey data published by Property118 shows, these responses were not drawn from a fringe audience. The average respondent owns 9.7 rental properties, which means these are decisions being made by experienced, commercially minded portfolio landlords.

Strategic decisions, not distress

One of the more revealing aspects of the data is what sits behind these decisions. The same Property118 Landlord Sentiment Survey Q1 2026 shows that a significant proportion of landlords are operating with relatively low leverage, with many holding loan-to-value ratios below 50%, and a notable percentage owning properties outright with no borrowing at all. This matters because it suggests that the decision to reduce portfolios is not being driven primarily by financial distress or forced sales. Instead, it points towards a more deliberate, strategic repositioning.

Landlords are choosing to step back.

A signal for policymakers and lenders

The implications extend beyond individual landlords.

A sustained imbalance between sellers and buyers has the potential to reshape supply dynamics across the private rented sector. Fewer landlords expanding means fewer new properties entering the rental market, while increased selling activity may reduce available stock over time, particularly if properties are sold to owner-occupiers.

For lenders, brokers and policymakers, the message is clear: Landlord behaviour is changing, and it is changing in one direction.

The beginning of a trend

This survey represents the first in a planned quarterly series, meaning the figures provide an early indication rather than a one-off anomaly.

If similar patterns emerge in future quarters, the Q1 2026 results may come to be seen as the start of a longer-term structural shift in how landlords engage with the market.

For now, one conclusion stands out: Landlords are not expanding, they are consolidating, repositioning and, in many cases, quietly exiting.

A conversation worth having?

If you are weighing up your own strategy, whether that’s to sell, expand, or restructure to improve profitibility, it is worth having a discussion with a Property118 consultant to take a closer look at how your portfolio is structured as a whole now, and to forecast the outcomes based on multiple scenario’s.

These conversations are typically most useful for landlords with established portfolios and relatively modest borrowing who are beginning to reflect on how their assets could work more effectively in the years ahead.

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