The Intermediary – September 2025 - Flipbook - Page 18
BUY-TO-LET
In focus
Portfolio landlords:
Not just surviving,
thriving
I
f there’s one thing I’ve learned
from my many years in the
industry, and talking to
brokers and landlords up and
down the country, it’s that the
buy-to-let (BTL) sector never
stands still. The rules may change,
certain costs escalate, landlord
demands intensify and tenant needs
evolve – sometimes all at once – and
yet, the private rented sector (PRS)
keeps moving forward with purpose,
passion and prominence.
For the vast majority of portfolio
landlords, 2025 hasn’t been about
siing tight and waiting for calmer
waters. It’s been about making
smarter moves, trimming what no
longer works, doubling down on
high-performing properties, and
venturing into asset types they may
never have considered before. In other
words: using this period to sharpen
their game.
The numbers
The latest Pegasus Insight Landlord
Trends Report, produced in
conjunction with Foundation Home
Loans, confirms what I’ve been
hearing. Yes, the pressures are real
– from regulation to affordability,
and regarding the general economic
climate – but the fundamentals of
profitability, yields and resilience are
still very much intact.
For those prepared to adapt, there’s
every reason to remain optimistic.
Almost nine in 10 (87%) landlords
are still making a profit from their
leings activity, a figure that has
barely shied in five years, and is just
1% shy of the five-year peak in Q4
2020 (88%).
More than one in five (21%) consider
those profits to be ‘large’, while only
5% are operating at a loss. It’s worth
noting that unencumbered landlords
16
The Intermediary | September 2025
GRANT HENDRY
is director of sales at
Foundation Home Loans
still lead the way (92% in profit), but
even those with funding requirements
are reporting healthy numbers at 82%,
meaning that well-run portfolios with
a long-term vision can still deliver,
even in tougher times.
Yields are also holding up nicely.
The national average sits at 6.5%,
matching the 10-year high reached in
Q3 2024, with the North West (7.4%),
North East and East Midlands (both
7.3%) out in front.
Confidence in the UK economy may
be languishing at a record low of just
2%, but optimism in landlords’ own
leings businesses is a different story.
More than a third (35%) feel positive
about their operations, and it’s clear
that profitability plays a role, with
70% of those who are making a ‘large’
profit confident about the future,
compared with just 13% of those
breaking even or in the red.
One trend I’m seeing first-hand is
landlords reassessing the make-up
of their portfolios. While vanilla
BTLs remain a staple, there’s definite
movement into higher yielding, more
complex assets like larger houses in
multiple occupation (HMOs) and
multi-unit freehold blocks (MUFBs).
This isn’t just about chasing
yield, it’s about diversifying income
streams and strengthening resilience.
These aren’t always straightforward
purchases, but that’s where specialist
lenders come in.
Finding solutions
Refinancing is another big story.
The Pegasus data shows that 40% of
leveraged landlords plan to refinance
in the next year, well above the 30%
norm we saw before the 2023 rate
rises. For portfolio landlords, that
number jumps to 53%, with an average
of three loans up for renewal across
9.8-property portfolios.
The expiry of fixed rates is the main
driver. While two-thirds will stay
with their current lender, a quarter
are switching, rising to 37% for those
with 11-plus properties. More than a
third are hiing challenges at the end
of their fixed term, from rate shocks to
valuation issues.
That’s where brokers can make
a real difference, by stepping in
early, smoothing the process, and
finding solutions that keep portfolios
performing optimally.
Two-thirds of landlords used a
broker for their most recent deal,
but those opting for a simple product
transfer were far more likely to
go direct. For me, that’s a missed
opportunity, because the best advice
isn’t just about rate-hunting, it’s about
strategic thinking.
As I see it, the brokers adding the
most value in the current market
are the ones helping landlords
see the bigger picture in terms
of restructuring for efficiency,
planning for tax, and exploring
specialist property types that could
transform returns.
With the right finance partner,
portfolio landlords are proving they
can adapt, diversify, and thrive. For
brokers, this is the moment to be
more than a facilitator; it’s the time
to be a trusted guide, helping clients
make the right moves at the right
time. That’s how the most successful
landlord-broker partnerships will not
only survive this market, but thrive. ●
