While most landlords are making good profits on their portfolios, with higher yields, the Renters’ Rights Act is raising concerns among some landlords, Aldermore reveals.
Data from Aldermore, collected in partnership with Pegasus Insight, shows that the Renters’ Rights Act, which came into effect on May 1, is worrying landlords with smaller portfolios as their expectations for future rental activity fall.
This shows that five in six landlords (84%) indicate that their rental activities are profitable.
Unencumbered landlords are more likely to report profits than those who borrow (90% vs. 77%), and landlords with larger portfolios are also more likely to report higher profit levels.
The average return achieved is 6.5%, a slight increase compared to the past quarter.
Elsewhere, research shows that the proportion of landlords reporting strong demand for tenants continues to decline.
While 58% still see demand in the first quarter of 2026 as strong, this is down from 61% in the fourth quarter of 2025, and down from 73% compared to the first quarter of last year.
Since the first quarter of 2024, when 83% saw tenant demand as strong, that figure has fallen each consecutive quarter.
More and more landlords are reporting demand as average, while a smaller increase is reporting demand as weak.
Landlords’ expectations for their overall rental activity have fallen to the lowest level since the second quarter of 2023, almost three years ago.
It found that 27% of landlords felt positive in the first quarter of 2026, while the percentage of landlords feeling positive over the past two years hovered around the mid-30s.
When it comes to the Renters’ Rights Act, only 8% of landlords think the new legislation will have a positive impact on their portfolios.
Meanwhile, 16% expect no impact, while 70% expect an overall negative impact and 5% are unsure.
In addition, nine in ten landlords are also concerned about possible backlogs in the legal system when evicting tenants.
Aldermore Mortgage director Jon Cooper says: “Overall we see the more professional and sophisticated landlords navigating the changing market with more confidence, while part-time landlords with smaller portfolios may struggle to adapt.”
Cooper is aware of the challenges landlords face, but sees an opportunity for brokers to go a step further and play a more strategic role as clients move through an evolving sector.
He adds: “The circumstances may feel more complex than in previous years, but that is exactly the time when strong partnerships matter most.”
“Landlords are not exiting the sector in large numbers. Instead, they are becoming more selective and strategic. For brokers, this creates a clear opportunity to step in as a stabilizing influence, helping clients interpret changes and make informed decisions.”