Smaller landlords are feeling the heat, while professional operators are doubling down on strategy and portfolio quality
Landlord sentiment at the start of 2026 is far from euphoric, but nor is it panicked. Across the market, the tone is cautiously resilient: smaller, lightly geared landlords are feeling squeezed, while professional operators are doubling down on strategy, structure and portfolio quality.
From ‘accidental’ to intentional
Landlords are heading into 2026 with mixed feelings, says Guy Nyirenda, Head of Commercial and Specialist Lending at Altura Mortgage Finance (pictured left). Those he speaks to “have mixed views on 2026 and what it may mean”. On the positive side, there is optimism that falling rates will allow refinancing onto better products and help reduce costs. Against this sits “marked concerns about changing legislation and tax regimes and how this may bring additional challenges to running a successful business.”
Those pressures are accelerating a shift that many in the market describe as a structural reset.
“Landlord sentiment heading into 2026 feels more settled, but also more selective,” says Alex Upton, Managing Director of Specialist Mortgages & Bridging Finance at Hampshire Trust Bank (pictured middle left). “The market has shifted towards landlords who operate professionally and plan with intent. This feels less like a short-term reaction to recent change and more like a structural reset in how portfolios are owned and managed.”
Rates, regulation and tax “are no longer background considerations,” Upton adds. They are actively shaping how investors think about resilience and long‑term sustainability, with confidence increasingly found among landlords who “understand their numbers in detail and are realistic about what each asset needs to deliver.”
That overarching view is echoed by Euan Stewart, Mortgage and Protection Advisor at Perth Mortgage Centre (pictured middle right), who sees the mood splitting sharply by landlord type. In his words, smaller landlords feel “squeezed”, while larger, more professional operators remain broadly confident. Strong tenant demand and tight supply are keeping the fundamentals attractive – “the right property at the right price” still works – but rising costs, regulatory uncertainty and remortgage pressure are the main emotional drivers in every conversation.
Consolidation as the dominant theme
READ MORE: Tax squeeze pushes landlords towards limited company structures
Asked whether landlords are exiting, consolidating or expanding, everyone interviewed sees a bit of all three – but with consolidation emerging as the defining behaviour.
Nyirenda is clear that the landlords he looks after “appear to be consolidating their portfolio by a mixture of sales and refinance to try to reduce costs and increase profitability as higher taxes and higher costs bite into their margins.” Many are moving into higher‑yielding rentals such as HMOs and short‑term lets. These require more management, he notes, “but provide a better return”. Others who own buy-to-lets in their personal name “are once again reviewing whether to incorporate to assist with the high level of tax they are paying.”
Upton describes a more polarised picture, with exits “still taking place, particularly among smaller landlords or those holding isolated assets where refinancing and compliance costs materially change the balance of risk and return.” In most cases, he says, it is “the cumulative impact of several pressures over time” rather than a single trigger.
At the professional end of the market, outright exit is less common than portfolio triage. “Brokers tell us clients are reviewing portfolios asset by asset, selling underperforming stock and reinvesting into properties that offer stronger, more resilient income,” Upton says. Expansion is still happening, but it is “selective and deliberate, with experienced landlords buying to a clear strategy rather than chasing scale for its own sake.”
OSB Group’s Intermediary Director, Adrian Moloney (pictured right), sees the same divide. There is “a clear drive towards limited company set‑ups” that goes hand in hand with the shift towards more professional landlords, even as “some smaller landlords [are] exiting the market” altogether. Those exits, he argues, “present opportunities for larger professional landlords looking to build their portfolios.”
Stewart breaks this into three clear behavioural camps:
-
Exiting: mostly 1–2 property landlords, older owners or highly leveraged investors, often motivated by tax pressure, EPC concerns or remortgage affordability issues.
-
Consolidating: mid‑sized landlords selling weaker assets, reducing leverage and simplifying portfolios, with new purchases often moved into limited company structures for tax efficiency.
-
Expanding: professional investors with “war chests” actively targeting motivated sellers – often other landlords – and focusing on higher‑yield regions and value‑add opportunities.
Kevin Gibson, Operations Director of Ascot Bridging Finance, summarises it neatly: “We’re seeing a bit of all three, but consolidation is probably the dominant theme.” Some smaller or accidental landlords are choosing to exit, particularly where properties are low‑yielding, maintenance‑heavy or coming up to expensive refinances. Professional landlords, by contrast, are “reshaping portfolios, selling weaker assets and reinvesting into better‑quality stock with stronger long‑term prospects.”
Regulation as the catalyst, not the cause
Regulation and tax are the backdrop to almost every strategic decision.
For Moloney, the Renters Rights Act is “another important consideration” that may drive the market towards higher professional standards – “a good thing for tenants and the sector as a whole.” He also points to changes to Minimum Energy Efficiency Standards (MEES) and further EPC reform on the horizon for 2026, which will “impact landlords in different ways depending on the shape and size of their property portfolio.”
Upton warns that the implementation of renters’ rights is influencing sentiment not because landlords object to regulation in principle, but because of the “practical implications for control, risk and cashflow.” Greater clarity is welcome, he says, but it also brings “sharper scrutiny of whether portfolios are genuinely sustainable in a more regulated environment.”
Stewart flags EPC and energy upgrades as a looming cost pressure that sits alongside tax and remortgage risk. For many smaller landlords, those cumulative burdens tip the balance towards selling down.
Across the board, there is agreement that regulatory change tends to accelerate an underlying sorting process. “It does not remove appetite,” Upton says, “but it does raise the standard of decision‑making and long‑term planning.”
How lenders are responding to the new landlord archetype
On the funding side, lenders have not retreated from buy‑to‑let – but they are taking a more disciplined and differentiated approach, particularly towards portfolio landlords.
“There is increased focus on affordability, portfolio exposure and the sustainability of income, which is shaping both refinancing and acquisition activity,” Upton explains. This is “not a withdrawal of appetite” – well‑structured cases with a clear rationale “continue to progress” – but expectations around preparation and timing are higher than before. Refinancing now “needs to begin earlier, with clearer narratives around income, tenancy strategy and longer‑term plans.”
Stewart notes the same shift in emphasis. Stress tests remain tight – especially at higher LTVs – and portfolio underwriting has become more detailed, with lenders assessing whole‑portfolio performance rather than just the subject property. Five‑year fixes remain popular because they help deals pass affordability, although the pricing gap versus shorter terms has narrowed. Some landlords, he warns, are simply unable to refinance at current loan levels without injecting capital, leaving a product transfer with their existing lender as the only viable option.
Gibson also highlights a more nuanced underwriting stance. Lenders are “focusing on the overall portfolio, the borrower’s experience, and the quality of the underlying assets rather than just headline rental figures.” Professional landlords with a clear strategy are generally viewed more favourably than highly leveraged owners with weaker business cases, making “presentation and preparation” more important than ever.
Against this backdrop, specialist and short‑term finance has taken on a larger role. Gibson reports “increased use of specialist and short-term finance to help landlords manage transitions, whether that’s refinancing pressure, refurbishment, or timing issues, before moving onto longer-term funding.”
2026 risk: leaving it too late
READ MORE: Landlords diversify investments amid economic uncertainty
If there is a single theme uniting lender and broker commentary, it is timing.
“The biggest risk in 2026 is leaving key decisions too late,” Upton warns. Whether it is refinancing, regulatory preparation or portfolio reshaping, “delay reduces choice and increases pressure in a market that now demands greater certainty.” There is also risk, he adds, in “relying on assumptions that no longer reflect reality” – margins are tighter, and expectations around rent growth, voids and exits need to be grounded in achievable outcomes, not historic norms.
Gibson is blunt: “The biggest risk is complacency. Landlords who leave refinancing, compliance, or portfolio decisions too late could find themselves under pressure.” Stewart likewise highlights refinance risk as more ultra‑low rate deals mature, the danger of portfolio concentration in a single location or tenant type, and the tax‑planning gaps that can leave unwary landlords with unexpected liabilities.
For Moloney, looming regulatory change adds a further layer of uncertainty. “It will be interesting to see how the Renters Rights Act and the EPC timetable affects landlord behaviour,” he says. “Although there is increased competition, there are still plenty of opportunities” – but they are unlikely to fall into the lap of landlords who are slow to react.
The broker as strategic partner, not rate finder
If landlord behaviour is becoming more professional, broker support has to follow suit.
For Upton, the opportunity in 2026 lies in “proactive planning”. This is a year when professional landlords can “reshape portfolios, improve quality and align funding more closely with longer‑term objectives.” Brokers, in turn, can position themselves as long‑term strategic partners, “helping clients plan ahead, sequence decisions appropriately and work with lenders who understand complexity and provide consistency through change.”
Nyirenda stresses the importance of brokers and clients discussing portfolio plans for the next 12 months so that “planning can begin now,” and of brokers staying in close contact with lenders in their space to “discuss ideas for criteria changes that can assist the market moving forward.”
Stewart argues that the most effective advisers take a portfolio‑wide view rather than treating each case as a stand‑alone mortgage. That means helping small landlords decide whether to hold, sell or go fully professional, and working with portfolio landlords on optimisation, gearing strategy and diversification. Coordinating with accountants on structure and tax is increasingly non‑negotiable.
Moloney expects 2026 to bring “a record number of remortgages,” making “customer contact… all important.” He also flags potential challenges from changing regulation around execution‑only and a greater onus on borrowers to seek advice – something that could both increase demand for brokers and raise the bar for the advice they give.
Gibson believes the brokers who thrive will be the ones who are most proactive: mapping upcoming refinancing points, sense‑checking portfolio performance, and ensuring clients “choose the right funding for their strategy rather than chasing the cheapest rate.”
In a market where the casual landlord is steadily being replaced by the deliberate investor, one takeaway is clear: property must be treated as a business – and brokers who help landlords do exactly that will be central to who succeeds in 2026 and beyond.
