Landlord sentiment remains stable despite the broader economic turmoil, according to Landby.
The lender’s latest survey said landlords continue to make clear, informed decisions about their investment portfolios.
But the survey also found a growing gap between landlords’ confidence in their investment portfolios and their view of the broader economy.
Views on landlords’ individual buyouts have stabilized, with 41.4% of landlords describing themselves as neutral, with 21.8% positive and 36.8% negative.
But confidence in the UK economy remains significantly more pessimistic, with 69.2% expressing negative expectations, 27.1% neutral and only 3.8% positive.
This reflects a market in which landlords are focusing on what they can control themselves, namely portfolio performance and financing, while remaining cautious about the broader economic outlook, Landby said.
Most owners are not planning to buy or sell in the next 12 months, although a significant proportion still plan to move, activity remains balanced rather than subdued.
Just over half (51.9%) said they were not currently planning to purchase additional properties, while more than a third (35.3%) planned to add to their investment portfolios.
Meanwhile, selling intentions remain consistent with previous results, suggesting an ongoing portfolio reshaping rather than any broad exit from the sector.
This reflects the ability of landlords to adapt to current conditions, even if they remain cautious about the direction of the broader economy, Landby said.
Despite the current backdrop, many landlords continue to report strong returns. A large number of these generate total returns of 4-6% (27.1%), with a large proportion (21.8%) reporting returns of 6%-8%; 15.8% of respondents reported returns of 10% or more.
Meanwhile, rents continue to move, with more than 75% of landlords planning increases of some kind over the next 12 months.
However, the approach to setting rents has become more flexible, which Landby suggests is partly due to the introduction of the rent system Tenants’ Rights Lawwith landlords balancing the need to manage rising costs against their new legal responsibilities and the tenant’s ability to afford the costs.
The results show that owners continue to prefer fixed-price products. Most (87.2%) showed a preference for two, three or five-year fixed rates as their next mortgage, with five-year rates (46.6%) remaining the most popular option.
Despite increased discussion of tracking products on the market, only 6% of landlords said they would likely choose this option for their next mortgage.
Landbay sales and distribution director Rob Stanton said: “The key difference compared to our previous survey results is that sentiment and confidence appear to have stabilized, even over a somewhat turbulent few months, particularly when it comes to product availability and pricing.
“Landlords, for the most part, appear to be very confident about their own property businesses, and the future of their investments, even as their views on the future performance of the broader economy remain much more skeptical.”
