Landlords are reassessing where they invest as regional differences in yields, arrears and void periods reshape buy-to-let strategies, research from Foundation has found.

The Q2 2026 Pegasus Insight Landlord Trends report recorded an estimated average portfolio value of £1.8m, gross rental income of £12,007 per property and an average yield of 6.4%.

Some 86% of landlords reported making a profit from their lettings activity, while 5% were operating at a loss.

However, 22% had sold a property during the previous 12 months compared with 6% who had purchased one, indicating that landlords were continuing to restructure their portfolios.

REGIONAL YIELDS LEAD LONDON

Central London landlords reported the highest average portfolio value at £3.7m and rental income of £17,989 per property, but its average yield of 5.3% was below the national figure.

The East of England and East Midlands produced the highest yields at 7.3%, followed by Yorkshire and the Humber at 6.8% and the North East at 6.6%.

The South West and West Midlands both recorded average yields of 6.5%.

Profitability was highest in the East Midlands, where 92% of landlords reported making a profit. This was followed by the West Midlands at 90%, and the East of England and South West at 89%.

RETURNS COME WITH ADDED RISKS

The research found that some higher-yielding regions also presented greater operational challenges.

In the North East, 55% of landlords had experienced void periods and 42% reported rental arrears.

Arrears affected 43% of landlords in Yorkshire and the Humber, 39% in the North West and 37% in the East Midlands, compared with the UK average of 26%.

Foundation said brokers and landlords should therefore consider tenant demand, voids and arrears alongside headline rental yields.

PORTFOLIOS RESTRUCTURED

The North West recorded the highest proportion of landlords selling property over the past year at 30%, followed by Yorkshire and the Humber at 29% and the East Midlands at 25%.

Purchasing activity was more subdued, although 18% of North East landlords had acquired property during the period.

Grant Hendry (main picture, inset), director of sales at Foundation, said: “The latest research reinforces the fact there is no such thing as a typical buy-to-let market.

“For brokers, understanding these local market dynamics has never been more important. The most effective advice goes beyond simply comparing rates and products.

“It involves helping landlords assess their long-term objectives, refinancing requirements, acquisition plans and portfolio strategy.”