Limited company landlords’ confidence is soaring, with 84% expecting rental yields to increase over the next 12 months according to Kensington Mortgages.
The lender, which surveyed 500 UK landlords, found that overall 89% feel confident about the outlook for the year ahead.
Within the sample, 80% are expecting rental demand to rise while 77% anticipate property prices to increase over the same period.
Despite this optimism, the survey revealed landlords are still wary of sustained cost and regulatory pressures.
Over three out of four (77%) expect mortgage costs to increase, while 81% report that their running costs have risen over the past year.
Meanwhile nearly four in five (79%) believe the regulatory environment will become more challenging.
Despite these evolving conditions, most landlords are holding firm on their investment strategies. Over half (53%) plan to maintain the size of their portfolio over the next 12 months, while almost four in ten (38%) intend to expand. Just 8% are considering reducing their holdings.
Kensington’s research also shed light on portfolio structure and strategy.
Over half of limited company landlords (53%) hold their entire portfolio within the limited company structure. Landlords who also had personal holdings reported gross rental yields of 5.04% from their limited company portfolios on average, compared to 4.88% from personally held properties, highlighting the financial advantages of the limited company structure.
Looking ahead, almost all respondents (95%) said they are looking to diversify into different property types. Corporate lets top the list (37%), followed by HMOs with six bedrooms or more (18%), family homes (17%), and single-tenant properties (13%).
“What’s particularly notable is that confidence is not translating into complacency,” said Allison Buckley, CEO at Kensington Mortgages.
“Many landlords are actively reviewing and diversifying their portfolios, with growing interest in corporate lets and larger HMOs, demonstrating a clear focus on long-term income and adaptability.
“The limited company structure continues to play a central role in this evolution, with yields marginally higher on company-held portfolios compared to personal holdings.”
