Landlord resilience grows despite legislative pressure

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Landlord resilience grows despite legislative pressure

Despite ongoing pressure in the private rented sector, landlords remain resilient, with new data showing most are still making a profit.

Research by lender Foundation reveals that 84% of landlords report their lettings activity is profitable, with average rental yields edging up to 6.5%.

The figures come after the Renters’ Rights Act came into force on 1 May 2026.

PRS continues to prove its resilience

According to the data, confidence levels are also showing tentative signs of recovery. The National Residential Landlords Association (NRLA) says its landlord confidence measure rose across all regions in Q1, while the proportion of landlords planning to remain in the sector increased to 63%, up from 58% in Q4 2025.

Following the government’s announcement that all private rented properties must meet EPC C targets by 2030, 62% of landlords with lower-rated properties say they plan to carry out improvement works to meet the new requirements.

Nearly four in 10 landlords with borrowing (39%) are planning to remortgage in the next year, while the average portfolio size has increased to 7.3 properties.

Grant Hendry, director of sales at Foundation, says many landlords are adapting to changes in the private rented sector.

He said: “The latest data shows a landlord community and wider private rental sector that continues to prove its resilience. While landlords are clearly facing a range of challenges, from rising costs to regulatory change, the fundamentals remain strong. Profitability is holding up, yields are stable, and we’re seeing early signs that confidence is beginning to return.

“What is particularly notable is the way in which landlords are adapting. Portfolio sizes are increasing, more investors are taking a structured, long-term approach, and there is clear evidence of landlords planning ahead, whether that is through refinancing activity or preparing for future EPC requirements.

“At the same time, we shouldn’t ignore the pressures that remain. Softer tenant demand and rising voids show this is a more balanced market than in recent years, and some landlords will continue to reassess their position. However, the overall picture is one of a sector that is evolving rather than retreating.”

Landlords leaving the market

However, the lender also reveals that some landlords are choosing to exit the market, with 42% said they plan to sell at least one rental property in the next year.

The data also reveals round 61% of landlords expect to increase rents over the next 12 months, with an average projected rise of 5.7%.

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