UK landlords bought 85,000 fewer properties in the past year, with just 6% of Britain’s estimated 2.84 million landlords expanding their portfolios—down from 9% in early 2024. The slowdown, revealed in new analysis by Dwelly using HMRC and The Mortgage Works data, underscores how higher borrowing costs and regulatory uncertainty are weighing on expansion.

Confidence Squeezed by Politics

Annual acquisitions fell to 170,520 from 255,780 a year earlier, as investors delay decisions until the Renters’ Rights Bill—which promises sweeping changes to tenancy law, eviction powers and compliance duties—is finalised.

Sam Humphreys, Head of M&A at Dwelly, said: “An 85,000 drop in annual landlord purchases is a clear signal that confidence has been dented by regulatory uncertainty, higher borrowing costs and slower house price growth. But this is not a mass withdrawal—landlords are simply taking stock.”

Regional Patterns of Resilience

• East of England: 23,360 purchases (highest)

• East Midlands: 21,720

• South East: 18,760

• South West: 18,300

• North West: 18,080

• London: 14,010

• North East: 11,390 (highest proportion of active landlords, 17%)

• Wales: 2,180 (weakest activity)

Despite these figures, many landlords are sitting on the sidelines rather than exiting. Alan Reeve, a landlord in the North West, explained:  “I was looking at adding another flat in Manchester this summer, but with Section 21 on the chopping block and more compliance costs coming, I’m holding off. My tenants are fine, my yields are fine—why risk uncertainty until we know what we’re dealing with?”

Supply Crunch Risk

Industry groups warn that fewer new buy-to-let purchases will only deepen the rental supply shortage, particularly in high-demand cities. The NRLA has urged ministers to balance tenant protections with landlord confidence, stressing that one-sided reforms could ultimately drive rents higher.

Humphreys remains upbeat on the fundamentals:  “Once the Renters’ Rights Bill is finalised we expect many will return to buying, particularly in those regions where rental properties continue to bring strong returns.”