UK buy to let market data, Q2 2026: what it actually means for landlords

The Mortgage Works has just published its latest landlord research, covering the second quarter of 2026. It’s based on survey responses from NRLA members with buy to let property across the UK, and it’s one of the better snapshots of what’s actually happening to landlords right now, not what the headlines say is happening.

Here’s what stood out, and what I think it means if you’re a landlord in Hampshire or anywhere else.

Confidence is down, but not collapsing

Landlords were asked to rate their prospects for the next three months as “good” or “very good” across three areas. All three fell year-on-year:

• Rental yields: 33%, down from 37% a year ago
• Their own lettings business: 32%, down from 35%
• Capital gains: 16%, down from 18%

The yields figure is the one that moved most, down 4 percentage points. But it’s worth putting this in context. Confidence in landlords’ own lettings businesses has been tracked since 2016, and it’s swung between 22% and 44% over that decade. At 32%, it’s not a low point. It’s roughly where it’s sat for most of the last three years. Landlords are cautious, not fleeing.

Confidence in the wider UK economy is the standout number though: just 4% of landlords rate the economy’s prospects as good over the next three months. That’s a comment on the broader mood, not the lettings business specifically.

More landlords planning to sell than buy, by a wide margin

43% of landlords say they intend to sell a property in the next 12 months. Only 6% intend to buy. That’s more than seven times as many planned sellers as buyers.

That gap isn’t new. Portfolio landlords have been trimming for a few years now, and it’s worth sitting with if you’re weighing up your own next move. It doesn’t mean the market’s broken. It means supply from smaller, often unmortgaged or lightly-leveraged landlords continues to work its way out of the sector, while the landlords who stay tend to be more geared toward professional structures.

Which brings me to the next figure.

I’ve pulled that specific 43%/6% sell-versus-buy split out into its own piece, with a closer look at whether the gap is as alarming as the headline number suggests: landlords selling outnumber buyers seven to one.

The shift to limited companies is still accelerating

40% of leveraged landlords expect to remortgage or arrange a product transfer in the next 12 months. Of those, 23% plan to do it through a limited company.

Mortgage interest relief works differently for limited companies than it does for individual landlords, which is usually the reason a transfer like this gets considered in the first place. The tax consequences of actually doing it are a conversation for your accountant. The mortgage side, what a lender will and won’t do, and what it costs to arrange, is where I can help.

Rents are still rising, just not as fast

63% of landlords put rents up in the last 12 months. That’s down from 69% a year ago, and down from 74% two years ago. Only 2% cut rents, the rest held them flat.

So the direction hasn’t reversed, rent increases are still far more common than decreases, but the pace has clearly come off its 2024 peak. That fits with a market where landlord numbers are shrinking gradually and voids and arrears are becoming more of a live issue for the ones who remain.

Most landlords are still profitable, but leverage matters

86% of landlords report making a profit from their lettings activity, 9% are breaking even, and 5% are making a loss. That’s a strong number given everything landlords have absorbed over the past few years.

But there’s a real gap depending on how the property’s funded. 92% of landlords with no mortgage report a profit, against 81% of those with buy to let borrowing. That’s not a surprise; borrowing costs money. But it’s a useful reminder that the mortgage itself, not just the rent, is one of the biggest levers a landlord has over their own numbers. Rate, product type, and how a portfolio’s structured all move that 81% figure around, which is a large part of why I review landlords’ existing deals rather than just arranging new ones.

Income scales heavily with portfolio size too. The average landlord with one property reports £17,000 a year in gross rental income. With 11 or more properties, that average rises to £244,000. And landlords holding through a limited company report average gross income of £170,000, against £64,000 for individual ownership, though that’s partly a function of limited company landlords typically holding larger portfolios in the first place, not proof that the structure itself doubles income.

Regional yields: where does the South East sit?

The average UK rental yield in Q2 2026 was 6.4%, just 0.2 percentage points below the ten-year high recorded in Q3 2025. Regionally, it varies a lot:

Figures are for illustration only, based on the assumptions and sources shown, and are not a quote or a guarantee of what you can borrow or what a lender will accept. Lender criteria and rates change often. Read the full important information.

The South East, where most of my landlord clients are based, sits at 6.1%, below the UK average but well above Central London and Wales. South East respondents reported average gross rental income of £11,398 per property on an average portfolio of 8.8 properties, and 87% said they were making a profit, just above the 86% UK figure. Confidence locally tracked the national picture closely: 33% rated rental yield prospects as good, in line with the UK figure, and 33% for their own lettings business, just ahead of the 32% national number.

What this means if you’re a landlord right now

This isn’t a reason to panic. It isn’t a reason to assume everything’s fine either. Rents are still generally moving up and most landlords are still profitable, but the sums are tighter than they were, and more landlords are actively reviewing their structure, their mortgage, or whether to keep a property at all.

Whether any of that applies to you depends on your own portfolio, your mortgage terms, and what you’re trying to achieve, which is exactly the kind of thing a proper conversation covers rather than a general data release. If you’re wondering whether your current buy to let mortgage still stacks up, or whether a limited company structure is worth looking into, get in touch and we’ll go through it properly.

Update, August 2026: the limited company question now has a deadline attached. From April 2027, income tax on rental profits held in your personal name rises to 22%, 42% and 47%, while corporation tax is unchanged. I have written about the April 2027 landlord tax rise and who the company route suits.