Portfolio landlords buck the trend by expanding their portfolios

The UK’s private rented sector (PRS) landlords are defying growing economic pressures by expanding their property portfolios, according to a new analysis.

The research from Inventory Base reveals that instead of downsizing, landlords are opting to acquire more, lower-value properties to boost their rental income.

The analysis reveals that the average landlord’s portfolio size increased by 5.6% in Q2 2024, reaching 7.6 properties.

However, the average property value within these portfolios dropped by 10.5% to £223,684.

As a result, the overall value of the average landlord’s portfolio fell by 5.6% to £1.7 million.

‘Landlords have been through a lot’

The firm’s operations director, Siân Hemming-Metcalfe, said: “Whether it’s increases to capital gains tax, higher stamp duty, soaring interest rates, or even the proposed Renters’ Rights Bill, UK landlords have been through a lot.

“The challenges just keep piling up. But despite these pressures, landlords are finding ways to adapt to their ‘new normal’.”

She added: “It was widely predicted that these pressures would force landlords to sell up and exit the rental sector, but the reality tells a different story.

“Instead of stepping away, landlords are showing resilience and adaptability.

“By finding ways to navigate the challenges, they’re ensuring their properties continue to play a vital role in the housing market.”

Rising rent prices

Despite the decline in overall portfolio value, landlords are benefiting from rising rent prices.

According to Rightmove’s rental price tracker, average rents grew by 1.8% quarterly and 6.8% annually in Q2 2024.

This increase, coupled with the expansion of portfolios, has led to a rise in average rental yields from 6.1% in Q1 2024 to 6.3% in Q2 2024.

The data shows that in Q1 2024, a landlord’s average rental yield was at 6.1%, but in Q2 it was +0.2% higher at an average of 6.3%.

Share This Article