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Stable foundations and ongoing consolidation are shaping the next phase of buy to let, says Aneisha Beveridge, head of research at Hamptons.
Our 2026 programme of Get More With Aldermore webinar sessions kicked off in January with a buy to let market update from Aneisha Beveridge, head of research at Hamptons.
She set out how the sector is adapting to changing rules and what brokers can expect from their landlord clients over the year ahead.
Buy to let has spent much of the past decade under pressure from policy and tax changes, from the stamp duty surcharge to restrictions on mortgage interest relief. Those changes have reshaped the economics of the private rented sector and fuelled headlines about landlords “fleeing” the market.
The reality, Aneisha said, is more balanced. While landlord sales peaked in 2022, when around 16% of homes sold were rental properties, the pace of exits has since eased.
The bigger change has been a slowdown in new purchases, rather than a surge in selling.
The sector hasn’t collapsed; it has consolidated. Many owners have adapted to higher costs and tighter regulation, while others have pressed pause on new investment until conditions improve.
It’s also changing where investors are putting their money, with nearly three quarters of London-based investors now buying outside the capital in search of stronger yields and lower-maintenance properties.
Rents surged after the pandemic, peaking at around 13.1% growth in the summer of 2022. Since then, growth has eased steadily and, in December 2025, average rents across Great Britain fell by 0.7% year on year, the first annual fall since Hamptons’ records began in 2011, with London leading the decline, down 3%.
Aneisha cautioned against reading too much into the recent dip, describing it as “more of a normalisation than a correction.”
The slowdown is being driven by changes in demand rather than a sudden increase in supply. A record share of first-time buyers, around 33% of all purchases, have moved out of the rental sector as mortgage rates eased and affordability improved. At the same time, fewer new graduates and international renters are entering the market, with around 8% fewer applicants registering to rent and homes taking slightly longer to let.
Stepping back, rents are still much higher than they were a few years ago. Over the past decade, they have risen by around 48%, well ahead of inflation, with the average rent up £318 a month since 2020.
Rents may have cooled, but yields have moved the other way. Average yields now sit at around 7.1% across England and Wales, rising to 8.3% in parts of northern England.
“Yields have become the saving grace for many landlords,” Aneisha said.
With savings rates starting to fall, buy to let is beginning to look more appealing again for landlords focused on income, rather than simply parking money in cash.
That’s feeding into where investment is happening. The North East stands out as the only region where landlords are buying a higher share of homes than they were in 2016, helped by lower purchase prices and stronger rental returns.
For many landlords, particularly those who bought before 2015, higher rents have created a bit more breathing space, helping to absorb higher mortgage costs and day-to-day expenses. Even for those buying more recently, the numbers can still stack up in the right locations.
One of the biggest shifts in buy to let in recent years has been the move towards limited company ownership.
In 2025 alone, more than 66,500 new buy to let companies were set up, an increase of 8% year on year.
Around 75% of new buy to let purchases are now made through limited companies, bringing the total number of properties held this way to around 735,000.
The appeal is easy to understand. For many landlords, limited companies offer a more tax-efficient way to hold property, particularly for those looking to build or retain larger portfolios. Larger landlords are more likely to keep expanding, while smaller landlords are more inclined to sell or simply stand still. Many are doing neither, choosing instead to sit tight.
“For some landlords, it’s about adapting, not expanding or exiting.”
But limited company ownership isn’t right for everyone. Higher mortgage rates, additional running costs and potential tax implications mean it remains a decision that needs careful, individual advice.
Regulation is becoming a bigger part of everyday landlord decision-making, with the Renters’ Rights Act coming into force this year.
Alongside those changes, landlords are also dealing with higher ongoing costs, from maintenance to insurance and looming EPC requirements. While falling mortgage rates will offer some relief, costs are unlikely to return to pre-2020 levels.
As the new rules are set to limit rent increases and bring an end to bidding wars, Aneisha noted that some landlords may act sooner rather than later. Many are factoring in higher costs and risks and looking to increase rents while they still can.
As a result, Hamptons expects rental growth to pick up modestly to around 3.5% this year, supported by income growth and the shortage of rental homes, with the strongest growth expected in northern England.
“Buy to let isn’t dead, but it is consolidating”, Aneisha said. “We’re likely to see fewer landlords, but with larger, more professional portfolios.”
For brokers, this reinforces the importance of tailored advice and access to the right finance as landlord strategies evolve. Whether clients are looking to buy in different regions, focus more closely on yields or weigh up incorporation, clear guidance and accurate market knowledge are critical.
Trusted research and data, including Hamptons’ Property Research and Insights, can help brokers support landlords with confidence as the market continues to consolidate.