The Intermediary –- June 2026 - Flipbook - Page 29
BUY-TO-LET
Opinion
Smaller landlords
must think
differently
T
he buy-to-let (BTL)
market has changed
significantly over the
past few years – and so
has the mindset needed
to succeed in it.
Higher interest rates, tougher
regulation, energy efficiency
requirements and affordability
pressures have undoubtedly
created challenges.
Yet despite repeated predictions
of decline, the sector remains
remarkably resilient.
According to UK Finance, buy-tolet lending activity increased during
2025, while rental demand continues
to outstrip supply across much of
the country.
At the same time, the latest
Nationwide Building Society House
Price Index continues to show modest
annual house price growth nationally,
supported by ongoing housing
shortages and strong tenant demand.
For smaller landlords, in particular,
the market increasingly rewards
strategy over scale.
The days of passive portfolio growth
driven largely by rising property
values are fading. Today’s most
successful landlords are treating their
portfolios as businesses – actively
managing cashflow, reviewing asset
performance and adapting quickly to
changing market conditions.
Ultimately a more professional and
agile profile of landlord exists today,
with further recent changes like
the Renters’ Right Act making this
increasingly important.
Lenders are a bit more cautious on
key aspects like stress testing, because
possession timelines, compliance risk
and landlord exit strategy are more
important than under the old AST/
Section 21 regime. Landlords who
know what they are doing and have
ALEX ALEXANDROU
is sales director – BTL
and unregulated bridging
at United Trust Bank
a clear strategy are what lenders are
looking for.
Location
Traditional ‘safe haven’ prime areas
no longer automatically deliver the
best returns. Affordability pressures
and hybrid working paerns are
reshaping tenant demand, with wellconnected regional towns and cities
oen outperforming more expensive
locations on a risk-adjusted basis.
Investors are placing greater
emphasis on sustainable rental
demand, employment strength,
transport connectivity and tenant
stability rather than simply chasing
headline capital values.
the portfolio already in place. Energy
efficiency is another area landlords
cannot ignore.
With Minimum Energy Efficiency
Standards (MEES) continuing to
evolve, investors who proactively
upgrade properties now may avoid
larger costs and disruption later
while improving tenant appeal in
the process.
Property type
Finance structures
While standard single-let properties
still have a role to play, many
experienced landlords are diversifying
into assets such as houses in multiple
occupation (HMOs), multi-unit
blocks (MUBs) and family housing in
undersupplied areas.
These properties can require more
hands-on management, but they oen
provide stronger yields and more
resilient long-term demand when
managed well.
Many landlords are still carrying
funding arrangements put in
place during very different market
conditions. Reviewing borrowing
structures, refinance opportunities
and portfolio leverage with an
experienced broker can oen uncover
opportunities to improve cash flow
and create greater flexibility for
future investment.
At United Trust Bank, we
increasingly see the most successful
landlords taking a disciplined,
long-term approach to portfolio
management. They are selective
about acquisitions, focused on tenant
demand and realistic about risk, while
working closely with brokers and
lenders who understand specialist
property investment.
The BTL market is undoubtedly
more complex than it once was. But
for landlords willing to adapt, plan
ahead and think strategically, the
opportunities remain substantial.
In today’s market, future-proofing is
not about owning the biggest portfolio.
It is about owning the right one. ●
Tenant demographics
More renters are remaining in the
private rented sector for longer,
including families and professionals
who may previously have expected
to buy. Increasingly, tenants are
prioritising space, energy efficiency
and quality accommodation.
Properties meeting those
expectations are typically leing faster
and experiencing lower void periods.
That means future-proofing is no
longer simply about buying more
properties. It is about improving the
quality, sustainability and resilience of
June 2026 | The Intermediary
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