Landlords remain active in the buy-to-let market despite a more challenging tax and regulatory backdrop, with falling mortgage rates creating a renewed incentive to review existing borrowing.

Research from buy-to-let lender Landbay suggests that while confidence was dented by the Autumn Budget, most landlords are continuing to adapt rather than withdraw from the sector.

The lender’s latest landlord survey, conducted at the end of December and the start of January, found that around 40% of respondents felt negative about the outlook for their own buy-to-let businesses. Landbay said this reflected immediate sentiment following the Budget, which appeared to have had a material impact on confidence.

However, the majority of landlords described themselves as either positive or neutral about their buy-to-let activity, indicating that most remain engaged and focused on planning around current conditions.

LANDLORDS REVIEWING NEXT STEPS

Despite continued tax and regulatory pressures, including new responsibilities under the Renters’ Rights Act and a planned 2% increase in property income tax from 2027, most landlords said they were cautiously optimistic about their own portfolios and future investment.

Almost half of respondents said they did not plan to buy or sell property over the next 12 months. Around a third expected to take action, while a significant proportion said they were still reviewing their options.

EVEN SPLIT

When asked whether the Budget would influence their plans over the coming year, landlords were evenly split, with 44% saying it would affect a decision to buy or sell, while 12% said it had not influenced their plans.

Among those expecting to act, the survey found a clear intention to review ownership structures, with many considering moving property held in individual names into limited company vehicles. Others said they would reassess purchase plans or raise rents.

Any planned rent increases were generally modest, with most landlords expecting rises broadly in line with inflation or slightly above, reflecting ongoing uncertainty around future costs and compliance requirements.

PRICING SHIFT CREATES REMORTGAGE OPPORTUNITY

The survey highlighted a potential opportunity around mortgage pricing. More than a third of landlords said the rate on their most recent buy-to-let mortgage was above 5%, reflecting borrowing arranged during the peak of the recent rate cycle.

Looking ahead, landlords appeared to favour longer-term certainty, with five-year fixed rates the most popular option when respondents were asked about their next remortgage.

Landbay said this combination of legacy pricing and forward planning created a strong case for landlords to review existing finance.

Its Premier range currently includes 2-year fixed rates from 3.24% and 5-year fixed remortgage products from 4.09%, both available up to 75% loan-to-value, with free valuations on remortgages.

The lender said that moving onto lower rates now available in the market could save landlord borrowers many thousands of pounds, helping to offset potential cost increases over the year ahead.

It urged advisers to engage with existing landlord clients and highlight current pricing across the market.

ADVISERS REMAIN CENTRAL

The survey also pointed to continued demand for advice, with around three-quarters of landlords saying they would use the same adviser again for their next mortgage.

Landbay said it would continue to run the survey to track sentiment and behaviour over time.

Rob Stanton, sales and distribution director at Landbay, said: “The results of this new iteration of our survey show landlords are incredibly realistic about the current pressures in the sector, particularly around tax and regulation, but also that they are actively engaged with the market, and looking for ways to improve the performance of their portfolios.

“Landlords were not enamoured of the Budget – that is obvious – but they are taking steps to mitigate against measures which may increase their costs, and many plan to add to portfolios, shift ownership structure, and raise rents, in order to ensure they remain profitable.”

PRICING SHIFT

And he added: “One of the key takeaways however is just how many landlords are carrying higher-rate mortgages arranged when pricing was less favourable.

“The good news here is that over the past six months in particular, pricing has shifted considerably, and advisers are likely to be able to secure some considerable savings for those borrowers coming up to remortgage.

“Our own Premier range has products starting with a three, far below the 5/6% deals a large number of landlord borrowers are currently on, and this presents a clear opportunity for advisers to revisit those clients and potentially secure much more favourable rates.

“With product transfers increasing across the market, it is vital that advisers remain close to their landlord clients. Reviewing existing borrowing and understanding how pricing has changed can make a meaningful difference to monthly costs and future planning.

“At Landbay, we remain firmly intermediary-only. Our Premier range, alongside our adviser-led product transfer proposition, is designed to support advisers and their landlord clients as they navigate a more complex but opportunity-rich market.”