Limited company landlords remain upbeat about the year ahead even as mortgage costs, running costs and regulation continue to rise, according to new research from Kensington Mortgages. Its latest BTL Barometer found 84 percent of company landlords expect rental yields to increase over the next 12 months, while 89 percent said they were confident about the wider outlook for the rental market.
For landlords, the split in the data matters. Confidence is still strong, but it is being driven by expectations of firmer yields and tenant demand rather than any easing in costs. Kensington found 77 percent expect mortgage costs to rise, 81 percent said running costs have increased over the past year, and 79 percent believe the regulatory environment will become more difficult.
Confidence holds despite higher costs
The lender said 80 percent of respondents expect rental demand to rise over the next year, while 77 percent think property prices will also move higher. Interest rates were cited as the biggest factor shaping confidence, mentioned by 31 percent of landlords, ahead of regulation at 26 percent, then property prices and rental demand at 25 percent each.
That suggests many professional landlords still see enough strength in the market to absorb higher borrowing and compliance costs. More than half – 53 percent – said they plan to keep their portfolio size unchanged over the next 12 months, while 38 percent intend to expand. Only 8 percent said they were considering reducing holdings, and fewer than 1 percent planned to leave the buy-to-let market entirely.
Landlords also reported relatively little difficulty finding finance, with 74 percent saying access to buy-to-let mortgage funding is currently easy. Kensington’s research points to a market where confidence is not coming from cheap money, but from a belief that rents and asset values can still support investment decisions.
Family homes still dominate portfolios
The survey found family homes were the most common asset class in limited company portfolios, held by 40 percent of respondents. HMOs with six bedrooms or more followed at 35 percent, with single-tenant residential properties at 33 percent and smaller HMOs at 27 percent.
There were also signs that landlords continue to see limited company ownership as commercially useful. Among respondents with both company-held and personally owned property, average gross rental yields were 5.04 percent for company portfolios compared with 4.88 percent for personally held stock.
Allison Buckley, chief executive of Kensington Mortgages, said: “The latest findings from our BTL Barometer 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.”
She added that many landlords were reviewing and diversifying their holdings, with corporate lets now the most popular area for diversification. Kensington said 95 percent of respondents were looking at different property types, including larger HMOs, family homes and single-tenant property.
Why the diversification trend matters
This follows Landlord Knowledge’s report on buy-to-let lenders cutting rates and widening criteria, which showed that lenders were becoming more willing to compete again for landlord business. The latest Kensington data suggests landlords are responding, but selectively. Rather than betting on a broad market rebound, many appear to be concentrating on structures and property types they believe can still protect margins.
That is also consistent with Landlord Knowledge’s recent coverage of rental yields strengthening in higher-return regions. If landlords still expect yields to improve despite higher costs, the practical question is where those returns can still be achieved after finance, repairs and regulation are factored in.
Readers can find Kensington’s buy-to-let information on the lender’s website.
What this means for landlords
- If you hold property in a company: Rising costs do not necessarily rule out expansion, but margins need stress-testing against mortgage rate, repair and compliance assumptions.
- Watch for: More landlord interest in larger HMOs, family homes and corporate lets, which could tighten competition in those segments.
- Bottom line: Confidence is holding up, but it is resting on stronger yields and demand rather than any fall in costs.
Editor’s view
The headline here is not optimism on its own. It is selective optimism. Landlords still see enough demand and yield potential to stay in the market, but the cost base remains heavy, so portfolio decisions are likely to become more disciplined rather than more aggressive.
Author: Editorial Team – UK landlord & buy-to-let news, policy, and finance
Published: 21 April 2026
Sources: Kensington Mortgages BTL Barometer, Kensington Mortgages buy-to-let page
Related reading: BTL lenders cut rates and widen criteria as competition returns
