The Intermediary – September 2026 - Flipbook - Page 18
BUY-TO-LET
In focus
LEGISLATION IS
CHANGING
THE CONVERSATION
FOR BROKERS
changes to taxation and increasing
regulation around requirements such
as minimum Energy Performance
Certificate (EPC) standards had
combined to persuade many smaller
landlords to exit the market.
Losing landlords
he Renters’ Rights
Act is widely viewed
as one of the most
significant changes
to the private
rented sector (PRS)
in a generation. While much of
the public debate has focused on
tenant protections, the legislation
is also reshaping lending decisions,
investment strategies and the role
brokers play in supporting landlords.
Lenders are reassessing risk,
investors are adapting their
strategies, and brokers are playing
an increasingly important role in
helping these clients to navigate a
changing market.
The Act came into force at a time
when the private rented sector was
already undergoing a significant
transformation. Rising interest rates,
T
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The Intermediary | September 2026
Recent research from the National
Residential Landlords Association
(NRLA) showed that 38% of singleproperty landlords considered they
were unlikely to remain landlords
by the end of 2026. For portfolio
landlords, that figure dropped to a
lower but still significant 21%.
Similarly, while 9% of singleproperty landlords expected to exit
the market before the new legislation
even came into force, only 1% of larger
landlords felt the same.
The reforms within the Act, such
as the abolition of Section 21 ‘no-fault
evictions’, are much further reaching,
and have done nothing to reverse this
trend. Indeed, they have accelerated
the professionalisation of the sector
and, in doing so, changed the
conversations that brokers are having
with their clients.
Hamptons has reported that
landlords accounted for 13.3% of all
property purchases in the first four
months of the year, the highest share
since 2016. Notably, 23% of those
properties were rental properties
previously – compared with a
five-year average of just 9.9%. This
data indicates that the market is
not retreating, but it is changing,
and perhaps in a way that was not
anticipated by the lawmakers.
The changing conversation
Where smaller landlords continue
to exit the market, experienced
investors are taking advantage of these
opportunities to acquire stock and
expand their portfolios.
That creates a different type of
borrower for lenders, and thus,
a different type of conversation
for brokers.
For brokers, understanding a
client’s wider investment strategy
becomes just as important as
understanding the funding
requirement. Whether clients are
looking to expand, consolidate
or reposition their portfolios, the
financing solution needs to support
those longer-term objectives.
For lenders, the legislation has not
reduced demand for buy-to-let (BTL)
lending, but it has changed how risk is
assessed.
Some of the changes are more
flexible for lenders – for example,
there is no longer a requirement
for the mortgage to predate the
tenancy – but other factors such
as longer possession timelines,
increased compliance obligations and
reduced flexibility around tenancy
management mean that lenders are
looking beyond the security itself to
assess the resilience of the landlord’s
wider business.
