Revealed - the part of rental sector not contracting right now

There may be a substantial number of small-scale private landlords selling up right now, but no fewer than 88 per cent of portfolio landlords have added to their portfolios in the last six months.

That’s the conclusion from a survey of 1,000 landlords by Shawbrook bank, which adds that 25 per cent of portfolio landlords intend to invest in an additional property in the next year, with 22 per cent looking to invest in multiple units.

A substantial number of those looking to add at least one property to their portfolio were looking to diversify by location (39 per cent) while 37 per cent were actively exploring different types of residential property. 

In addition, 26 per cent of portfolio landlords said they are turning their attention towards student housing and 21 per cent were looking at the retirement housing market.

The research comes amid ongoing concerns of high-demand and low-supply in the UK’s rental market, with demand for rental homes 51 per cent above the five year average, and the number of available homes 30 per cent below average in September 2023.

Shawbrook’s research, however, highlights a cohort of professional landlords continuing to invest and add quality rental stock to the market. 

Among those said they were diversifying their property portfolios, close to a third said they had done so to respond to tenant demand, while 28 per cent said they had done so to prioritise more energy efficient buildings.

In addition, of the 88 per cent who said they were planning to add at least one property to their portfolio, over a third wanted to capitalise on good deals currently in the market, with 35 per cent already having capital ready to invest.

A Shawbrook spokesperson says: “Whilst the property market remains challenging, it’s encouraging to see professional landlords continuing to invest and seek opportunities to diversify.

“Our research has shown that a significant number of landlords have taken proactive steps to expand their portfolios, while responding to demand to add quality, energy efficient rental stock to the market for renters.

“Looking ahead, it will be important for buy to let landlords to explore external financing options and lean on specialist lenders. To continue meeting buyer needs in a sustainable way, astute landlords will need to keep thinking one step ahead, adapting their strategies to adjust to the rapidly changing real estate landscape.”