Younger landlords sustain market activity despite tougher conditions
Millennials have become the dominant force in buy-to-let company incorporations across England and Wales, marking a significant change in landlord demographics.
Analysis by Hamptons, using Companies House data, shows that individuals born between 1981 and 1996 now make up half of all new shareholders in buy-to-let companies, signalling a generational shift in property investment.
Despite ongoing affordability issues, the influx of younger investors has helped maintain landlord activity, even as recent tax increases and stricter regulations have made the sector more complex.
Although this generation is less likely to own their own homes compared to older cohorts, projections suggest Millennials will set up a record 33,395 new buy-to-let companies this year, more than double the number in 2020. Five years ago, Millennials made up 40% of new shareholders, but their activity has surpassed that of Baby Boomers since 2017 and overtook Generation X in 2022.
Generation X represents 33% of new shareholders in companies formed this year, followed by Generation Z at 10% and Baby Boomers at 7%. The decline in Baby Boomer activity reflects a trend towards winding down or transferring portfolios rather than establishing new ones. Notably, 2025 marks the first year that Generation Z-led company incorporations have exceeded those by Baby Boomers. Three-quarters of shareholders in newly formed companies this year are under 50, compared with 68% a decade ago.
Meanwhile, data from Connells indicates that the proportion of homes purchased by landlords in England and Wales held steady year-on-year, despite the rise in the stamp duty surcharge for additional properties from 3% to 5% in April 2025. Landlords represented 11.3% of property purchases in the third quarter of 2025, a slight uptick from 11.2% in the same period last year.
However, landlord acquisitions are increasingly concentrated outside southern England. In the third quarter of 2025, London, the South East, South West and East of England together accounted for just 34% of investor purchases, a notable decline from 50% in 2016.
In London, landlords bought 8% of homes sold in the third quarter of 2025, the lowest share since 2020. Similar figures were recorded in the South West (8.1%) and East of England (8.2%), with over half of branches in these regions not recording a single landlord purchase during the quarter.
The North East remains a focal point for landlord activity, with investors accounting for 28.4% of purchases in the third quarter of 2025—more than three times the proportion seen in London. The region has consistently seen investor purchase shares above 20% in nine of the past 10 years, a trend attributed to lower property prices and higher yields, which have lessened the impact of the increased stamp duty surcharge.
Rents fall in September
Rental market data shows that the average rent for newly let properties in Great Britain fell by 0.3% in the year to September 2025, dropping from £1,402 to £1,398 per month. This contrasts with the 4.2% annual increase recorded a year earlier.
The decline was most pronounced in London, where rents fell by 2.7% (£65 per month), and in Inner London, where rents dropped by 4.6% to an average of £2,766 per month—£165 below the October 2024 peak.
In contrast, rents for renewed tenancies continued to rise, increasing by 4.6% over the past year and reaching an average of £1,307 per month. Renewal rent growth has remained relatively stable, with a 4.6% rise in September 2025 compared to 6.6% in September 2024. Over the past two years, the cost of renewing a tenancy has grown nearly three times faster than the cost of moving into a new property.
“Landlord purchases haven’t collapsed in the face of higher taxes and tighter regulation – but they have shifted,” said Aneisha Beveridge, head of research at Hamptons. “New landlords have increasingly become an endangered species in markets across Southern England, where big stamp duty bills and flatlining prices have nudged investors northwards. But in places like the North East, landlord activity remains close to all-time highs, showing that the buy-to-let market is adapting rather than retreating.
“What’s striking is the rise of younger landlords. Millennials – many of whom have struggled to buy their own home – are now leading the charge in buy-to-let. Thirty years on from the invention of the buy-to-let mortgage, which kickstarted investment by Baby Boomers, it’s clear that a new generation is finding alternative ways to build wealth through bricks and mortar. Despite the challenges, Millennials and Gen Z are showing a similar appetite for long-term property investment, which is helping to stabilise the market.
“Rental growth remained negative in September, with tenants finding they have more room to negotiate than they’ve had during the last five years. While lower rents are always welcome news for tenants, there are still too many cost pressures facing landlords for a nominal fall in rents to turn into a more meaningful correction in the months ahead.”
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