Landlords who own their properties via limited companies remain confident that their yields will improve despite rising costs, new research suggests.
The survey by Kensington found that 84% of limited company landlords expect yields to grow in spite of concerns many buy-to-let stakeholders have raised about the impact of the Renters’ Rights Act.
Kensington reports that 89% of limited company landlords were confident about the outlook for the UK rental market.
It says 77% expect mortgage costs to increase and 81%report that their running costs – including repairs, insurance, utilities, and maintenance – have risen over the past year.
Even so, 53% intend to maintain the size of their portfolio over the next year and 38% plan to expand.
The poll reveals 95% are looking to diversify, particularly into corporate lets, while fewer than 1% of company landlords plan to exit the market entirely in the next twelve months.
In a further show of confidence, 80% are expecting rental demand to rise and 77% predict property prices will increase over the next year.
Kensington chief executive Allison Buckley says: “The latest findings underline the resilience and professionalism of today’s limited company landlords.
“Despite experiencing higher operating expenses and anticipating increased mortgage costs and greater regulatory complexity ahead, landlords remain firmly committed to the sector – underpinned by strong tenant demand and expectations of improving yields.
“What’s particularly notable is that confidence is not translating into complacency.
“Many landlords are actively reviewing and diversifying their portfolios, with growing interest in corporate lets and larger houses of multiple occupation (HMO), demonstrating a clear focus on long-term income and adaptability.”
She adds: “The limited company structure continues to play a central role in this evolution, with yields marginally higher on company-held portfolios compared to personal holdings.
“As the market continues to evolve, specialist lenders have an important role to play in providing the flexible, tailored financing solutions that professional landlords need to navigate change and seize opportunity.”