Landlords who own their properties through limited companies remain confident their returns will improve despite rising costs, new research shows.
Kensington’s research shows that 84% of corporate landlords expect returns to rise, despite concerns expressed by many buy-to-let stakeholders about the impact of the Renters’ Rights Act.
Kensington reports that 89% of corporate landlords were confident about the prospects for the UK rental market.
It says 77% expect mortgage costs to rise and 81% report their ongoing costs – including repairs, insurance, utilities and maintenance – have increased over the past year.
Still, 53% plan to maintain the size of their portfolio in the coming year and 38% plan to expand.
The poll shows that 95% are looking to diversify, especially into commercial rentals, while less than 1% of business owners plan to exit the market completely in the next twelve months.
In a further show of confidence, 80% expect rental demand to rise and 77% predict property prices will rise in the coming year.
Kensington chief executive Allison Buckley said: “The latest findings underline the resilience and professionalism of today’s limited company landlords.
“Despite experiencing higher operating costs and anticipating higher mortgage costs and increased regulatory complexity, landlords remain firmly engaged in the sector – supported by strong tenant demand and expectations of improving returns.
“What is particularly striking is that trust does not translate into complacency.
“Many landlords are actively reviewing and diversifying their portfolios, with growing interest in commercial rentals and larger multi-occupancy (HMO) properties, demonstrating a clear focus on long-term income and adaptability.”
She adds: “The limited company structure continues to play a central role in this evolution, with returns on corporate portfolios marginally higher than on personal investments.
“As the market continues to evolve, specialist lenders have an important role to play in providing the flexible, tailor-made financing solutions that professional landlords need to navigate change and seize opportunities.”