Landlord investment in the PRS appears to be weakening, with higher mortgage costs making buy-to-let increasingly challenging, according to the latest figures.

Rightmove reports that the proportion of rental homes coming onto the market that were previously for sale has fallen from 17% to 15% - an indicator of reduced landlord investment this year. Meanwhile, the proportion of all homes for sale that were previously available to rent, an indicator of landlord selling activity, has remained broadly stable at around 13%, and only slightly up on last year (12%).

Elevated mortgage rates continue make property investment less attractive for prospective landlords, says Rightmove, particularly in areas where capital growth might also be limited. The average two-year fixed buy-to-let mortgage rate is now around 5.34%, compared with 4.16% before the war in Iran started.

Challenges

Matt Smith, Rightmove’s mortgage expert, reckons one of the biggest challenges for many landlords is managing the properties they already own when the time to remortgage comes around. “New buy-to-let investment has been relatively subdued for some time, and some landlords are still reaching the end of much cheaper fixed-rate deals taken out when borrowing costs were lower,” he adds.

“For those landlords, moving onto a higher mortgage rate can have a significant impact on monthly costs and rental yields. With rent reviews now generally limited to once a year, landlords need to plan carefully alongside refinancing. Where the numbers no longer add up, higher mortgage costs could ultimately influence decisions about whether to remortgage or sell a rental property.”

Rents

Rightmove reports that the average advertised rent of homes outside London has risen above £1,400 a month for the first time on record, reaching a new high of £1,418. While rents continue to rise, rental price growth has stabilised compared with the intense competition seen at the peak of the market. Between 2021 and 2023, annual rental growth hovered around +10%.

At a national level, the rental market remains relatively balanced, with the number of available rental homes 2% lower than a year ago, and renter demand also down by about 2%.

Dwelly

The number of rental properties available across England fell by 12.1% during the third quarter of 2026, according to new analysis by Dwelly. It found that some of the largest average quarterly reductions in available rental listings since the start of 2026 have been recorded in Bristol (-23.9%), West Yorkshire (-22.5%), Merseyside (-17.7%), South Yorkshire (-15.8%) and Leicestershire (-14.8%).

In contrast, Wiltshire has recorded the strongest average quarterly increase in rental availability since the start of 2026 (+17.4%), followed by West Sussex (+13.2%), Herefordshire (+9.0%), Suffolk (+7.8%) and Bedfordshire (+7.2%).

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