Professionalisation of the landlord sector has accelerated, with more property investors moving to limited company structures and specialist investments, research by Foundation Home Loans has found.
According to its Landlord Trends Q1 2025 data, carried out by Pegasus Insight, 60% of landlords planning to buy in the next year said they would do so through a limited company.
Over the past five years, the share of properties held in limited companies rose from 36% in Q1 2020 to 66% in Q1 2025.
Landlords with at least one property in a limited company owned an average of 14.6 properties, compared to 5.2 among those with all properties in their own name.
The research found one in five landlords owned at least one house in multiple occupation (HMO), rising to one in four among portfolio landlords.
6% held at least one holiday let, with this figure doubling for landlords with larger portfolios.
Data also revealed that the average number of HMOs was 3.6, while those with holiday lets owned 1.6 on average.
Among landlords with 11 or more properties, 29% had an HMO and 12% had a holiday let.
Rental yields stayed strong, averaging 6.3%, just below the 10-year high reached in Q3 2024.
The research found 84% of landlords made a profit, with 17% reporting a large profit and 67% a small profit.
For portfolio landlords with four or more buy-to-let (BTL) mortgages, 80% reported a profit despite higher costs.
Remortgage activity was expected to remain high through 2025, with 38% of landlords with BTL borrowing saying they intended to remortgage or carry out a product transfer within the next year.
Meanwhile, portfolio landlords expected to refinance three mortgages on average, with three-quarters planning to choose a fixed rate.
Of those, 32% said they would choose a 2-year fix and 35% a 5-year fix.
Additionally, research found that regulation was a key concern for landlords, with reform of possession laws, especially the planned removal of Section 21, cited as the main worry.
There was also growing concern over future energy performance requirements and minimum energy efficiency standards.
Landlords listed the cost of compliance, uncertainty around timescales, and a lack of support for supply as their main issues.
Grant Hendry, director of sales at Foundation Home Loans, said: “The story behind this quarter’s data is one of continuing evolution and resilience within the landlord community.
“Incorporation is no longer a niche strategy, it’s a mainstream structural approach, especially for landlords who are expanding or refinancing.
“The fact 60% of those planning to buy this year intend to do so through a limited company reflects how embedded this behaviour has become.”
Hendry added: “Specialist property investment is also a major theme, and it is interesting to see that larger portfolio landlords are targeting areas such as holiday lets, more than doubling their holdings of these properties.
“At Foundation Home Loans, we’ve certainly seen growth in holiday let mortgage demand due to a highly competitive product range, with criteria such as the utilisation of high, medium and low rental figures averaged over 39 weeks, maximum £2m loans, limited company availability and early remortgage, with no minimum income requirements.
“Whether it’s holiday lets, HMOs or multi-unit blocks, landlords are clearly broadening their portfolios in ways that demands deeper product expertise and flexible criteria.”
He said: “This is where advisers and specialist lenders, like Foundation Home Loans, can offer tangible value through products designed specifically to support this kind of diversification.
“It’s encouraging to see landlord profitability remaining strong, with rental yields holding up exceptionally well given the broader economic context.
“With 84% of landlords still making a profit and average yields of 6.3%, the market remains strong, particularly for experienced operators with well-managed portfolios.”
He added: “The remortgage opportunity this year remains very real; 38% of landlords with borrowing expect to refinance, many with multiple mortgages to review.
“That’s a prime opportunity for advisers to deliver solutions that match landlords’ ambitions, particularly those seeking to release equity to grow portfolios.
“This is a moment where good advice and flexible lending can make all the difference. We’re committed to supporting advisers in delivering both.
