Asked what currently prevents them from investing more in rental property, 28.3 per cent of landlords surveyed by the London lettings and estate agent pointed to landlord taxation, the number one barrier.
That is almost double the 15.1 per cent who blamed the Renters’ Rights Act and wider regulation, the issue that has dominated the sector’s headlines. Property prices ranked third on 12.6 per cent.
Economic uncertainty (9.8 per cent), problem tenants or rent arrears (8.6 per cent), Stamp Duty (6.8 per cent) and mortgage rates and finance costs (6.2 per cent) made up most of the rest.
The mirror image is just as emphatic. More favourable landlord taxation was by far the change most likely to prompt further purchases, cited by 36.9 per cent, ahead of lower Stamp Duty (13.7 per cent), a faster or easier possession process (12 per cent), greater confidence in the economy (11.6 per cent) and lower property prices (9 per cent).
For anyone tracking the cumulative effect of changes to buy-to-let tax and available reliefs, the ranking will come as little surprise.
Holding the line rather than expanding
Almost two-thirds of landlords, 62.7 per cent, intend to keep their portfolio at its current size over the next 12 months, which hardly suggests a sector in flight.
Expansion, though, is rare. Just 3.9 per cent intend to buy more, while 13 per cent plan to reduce their holdings and 14.2 per cent plan to leave the rental market altogether.
That leaves 27.2 per cent shrinking or exiting, seven times the proportion planning to grow, lending weight to warnings about rental homes vanishing from the private rented sector this year.
Among the minority weighing expansion, 43.7 per cent are motivated by long-term retirement and investment planning, followed by strong tenant demand (17.2 per cent), the belief that property currently represents good value (16.1 per cent) and expectations of house price growth (11.5 per cent).
Their preferred route is unfashionably conventional. The traditional residential single-let attracts 48.2 per cent, ahead of properties requiring refurbishment on 18.3 per cent and holiday or short-term lets on 11 per cent. HMOs (5.5 per cent), student accommodation (4.3 per cent), corporate lets (3.7 per cent) and new-build (3.7 per cent) trail well behind.
Faith in property, doubts about the sector
Half of landlords, 50.6 per cent, still believe residential property remains a good long-term investment despite increased regulation.
Confidence in the wider market is thinner. Some 39.1 per cent are somewhat or very unconfident about the sector’s long-term future, against 33.9 per cent who remain confident, a split echoing the mood tracked by the NRLA’s landlord confidence index.
Profitability expectations are weaker again. Some 38.9 per cent expect portfolio returns to fall over the next year, more than five times the 7.6 per cent anticipating an increase, while 45.8 per cent expect no change.
More than three-quarters, 78.5 per cent, say being a landlord is a less attractive proposition than it was five years ago, with 51.9 per cent describing it as much less attractive. Only 2.7 per cent think the job has improved.
Marc von Grundherr, director of Benham and Reeves, said: “Despite years of headlines predicting the demise of the private landlord, the reality is that buy-to-let remains an incredibly strong long-term investment and, importantly, half of landlords themselves still believe this to be the case.”
He added: “It’s particularly telling that taxation ranks well ahead of the Renters’ Rights Act when it comes to the biggest barrier preventing further investment. Regulation has understandably dominated the conversation recently, but landlords have also faced a sustained increase in the financial burden placed upon them.”
What this means for investors
For those already holding stock, scarcity is doing the heavy lifting. Average UK private rents rose by 3.7 per cent in the 12 months to July 2026 to £1,393, according to the Office for National Statistics, and with seven landlords retreating for every one expanding, the shrinking supply underpinning rental growth forecasts looks well entrenched.
For anyone hoping to buy, the next move rests with the Treasury rather than the housing ministry. Until the tax treatment of rental income shifts, capital will keep flowing into limited company structures, refurbishment plays and the plain single-let rather than into net new supply.
Von Grundherr’s warning is the one to watch: “Without this investment, rental supply will remain constrained and, ultimately, it will be tenants who suffer through greater competition and continued upward pressure on rents.”
