The survey reveals that 6% are making a loss, but many landlords are nervous about the future and the impact of the Renters’ Rights Act, which will be phased in from May.

Results from the poll by Pegasus Insight on behalf of the lender, show that 75% of landlords believe the act will have a negative impact on them personally and 84% believe it will harm the private rented sector more broadly.

Looking in more detail at landlords’ biggest concerns about the act, 91% feared backlogs in the court system for evicting tenants, while 88% were worried about the impact of the income tax rise on rental income for landlords who hold property in their own names. 

The research found that 84% of landlords say they will need to be more selective about tenants because of the reforms and 72% are considering rent increases.

Expectations for rental yields have fallen to a five-year low and the share of landlords reporting strong tenant demand has fallen to 61%, down by 7 percentage points from the previous quarter and by 16 percentage points year-on-year.

Aldermore director of mortgages Jon Cooper says: “What’s clear from the research is that most landlords have legitimate concerns about how the Renters’ Rights Act will impact their property portfolios.

“It’s vital that all landlords assess how the act will impact their lettings activity, to protect themselves and ensure they are able to continue offering a positive renting experience for their tenants.”

Cooper adds: “The sector faces challenges, but landlords are highly resilient. 

“They are also a cornerstone of the UK’s housing supply.”