Editor's note: This brief was summarised by The Property AI Newsroom from a report by The Negotiator. Read the original article for full details.

Landlords Cite Taxation as Main Barrier to Further Investment

Most UK landlords intend to maintain their current property portfolios over the next year, with taxation identified as the primary barrier to further investment, according to research by lettings agency brand Benham and Reeves.

The analysis found that 62.7% of landlords plan to keep their existing portfolios, while only 3.9% intend to expand. Taxation was ranked as both the biggest obstacle to additional investment and the top change that would encourage landlords to invest again.

Other changes landlords would like to see include lower Stamp Duty (13.7%), a faster or easier possession process (12%), greater confidence in the economy (11.6%), and lower property prices (9%).

Despite increased regulation, 50.6% of landlords believe residential property remains a good long-term investment. However, confidence in the wider future of the private rental market is mixed, with 39.1% of landlords stating they are either somewhat or very unconfident about its long-term prospects, compared to 33.9% who remain confident.

Profitability is also a concern for landlords. The research found that 38.9% expect the profitability of their buy-to-let portfolio to decrease in the next 12 months, while 7.6% expect it to increase. A further 45.8% expect profitability to remain unchanged. Additionally, 14.2% of landlords plan to exit the rental market entirely.

For those considering further investment, traditional residential single-let properties are the most attractive option, favoured by 48.2% of landlords. Properties requiring refurbishment are the next most popular at 18.3%, followed by holiday or short-term lets at 11%. Other options such as HMOs, student accommodation, corporate lets, and new-build properties account for smaller proportions of landlord interest.

Among landlords looking to expand, the main motivation is long-term retirement and investment planning (43.7%), followed by strong tenant demand (17.2%), the belief that property currently represents good value (16.1%), and expectations of house price growth (11.5%).

These findings are relevant for letting agents and inventory clerks monitoring landlord sentiment and market trends in the UK property sector.