The unique opportunities on offer in an evolving BTL landscape

As landlords face increased pressures, such as stamp duty increases, potential rental reforms, and proposed changes in EPC regulations, many are revaluating their portfolios. The report shows a notable increase in planned divestment among larger landlords, particularly those with over 20 properties (59%), and among leveraged landlords (46%) compared to outright owners (34%).

With fewer landlords looking to expand and only 6% intending to grow their portfolios, the net acquisition gap has widened to -35% from -21% in Q2. However, this shift highlights an opportunity for mortgage intermediaries to advise on restructuring and refinancing options, particularly for those intending to retain properties.

Notably, interest in individual flats is up this quarter (+14%), signalling a potential area of focus for intermediaries targeting investors who are still keen to diversify their property types. Additionally, while overall expansion intent is low, there are regional pockets of opportunity, with the South East showing higher appeal to investors compared to other areas. Intermediaries can leverage these insights to guide clients on location-based investment strategies.

Although only a relatively small percentage of landlords intend to purchase properties next year, the majority of these acquisitions will still be funded through BTL mortgages. A trend which indicates that intermediaries will remain essential in securing competitive financing for those committed to the market.

Finally, with around 60% of landlords having an exit timeline in mind, intermediaries can play a crucial role in helping align the right exit strategies, whether through support on inheritance planning or divestment. Even with an exit strategy in place, on average, such landlords plan to remain active for another 5-6 years, leaving intermediaries with a clear window to solidify these relationships.

These insights help to stress the intermediary sector's value in providing strategic guidance, helping landlords navigate complex challenges, and maximising the short, medium or longer-term potential of their portfolios.

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