23 October 2025
At The Mortgage Works, we've supported landlords for over 30 years. We understand the buy to let market is constantly evolving, and 2025 is no exception. With new regulations, shifting tax policies, and rising costs, landlords are reassessing their portfolios. Some are considering sale, others are exploring new strategies to adapt and thrive.
The short answer is; some are. But the full picture is nuanced. Whilst some landlords are choosing to sell, it is not necessarily to leave the market. And, in some cases the sale of a property is to another landlord.
Recent years have brought a wave of regulatory and financial change reshaping the buy to let sector. Including:
These factors have led some landlords - particularly those with smaller portfolios - to consider whether now is the right time to exit the market. In addition, landlords who have been operating since the rise of buy to let in the early 2000's are reaching the natural end of their mortgage term and considering their options.
Despite scaremongering headlines concerning an "exodus" of private landlords, underlying data suggests a far more resilient picture, with the Private Rented Sector holding around 18.8% of households in England - and only very modestly below its peak of 20.3% in 2017.
The more noticeable change in recent years, is the shift away from mortgaged properties to unencumbered private rentals, as landlords seek to de-leverage at a time when borrowing costs have risen. However, despite the number of outstanding buy to let loans falling by 6% since the 2022 peak, the overall balance sheet of buy to let remains largely unchanged at around £300bn, indicating the loans remaining are larger.
Landlord insights articulates nearly half have considered selling, with regulation cited as a key driver, we are not seeing landlords act at this scale on those considerations.
At The Mortgage Works, we believe in helping find solutions. Selling isn't the only option. Here are some strategies landlords are using to adapt:
Rather than exit, some landlords are choosing to consolidate their portfolios, selling less profitable properties and reinvesting in areas with stronger yields or lower upkeep and maintenance costs. This approach allows landlords to maintain income while improving long-term viability.
Improving a property's EPC rating not only ensures compliance with future regulations but can enhance tenant appeal and reduce void periods. Our research found landlords upgrading to an A or B rated property in England, could attract price and rental premiums of 11% and 7% respectively, compared to a D rated property. Borrowing more or taking advantage of grants and green finance options is a key consideration to help fund improvements.
Operating through a limited company can offer tax efficiencies, particularly for mortgage interest relief and corporation tax. While incorporation involves legal and financial considerations, it's an increasingly popular route for professional landlords.
Some landlords are exploring more niche segments to boost yields. Houses in Multiple Occupancy (HMOs) for example, can offer superior returns and have grown in popularity since the inflation crisis, the share of purchase transactions involving a HMO has roughly doubled to 4%.
Other strategies, include the short-term rental market, like holiday lets and serviced accommodation. Whilst these investments can offer higher returns, they come with different regulatory requirements and often increased management demands.
Experienced professional landlords are considering how to use proceeds from property sales to diversify into other asset classes, such as commercial property or semi-commercial property offering competitive returns. This could help spread risk and reduce exposure to regulatory changes.
The regulatory environment is changing, but with change comes opportunity. While some landlords are choosing to sell, many are adapting portfolios, improving energy efficiency, or exploring new rental models.
At The Mortgage Works, we're here for intermediaries and their landlord clients, helping to inform decisions and build a resilient, future-ready portfolio.
Information:
This article was authored by Daniel Clinton, Head of Buy to Let at The Mortgage Works, and was originally published by Iress as part of their Industry Voice series. Daniel also featured in a recent Iress podcast (opens in a new window), sharing further insights on the topic and more.
