After a bruising few years, Britain’s landlords are enjoying a welcome return to healthy returns. New research commissioned by specialist buy-to-let lender Paragon Bank shows that nearly nine in 10 are now making a profit — the highest proportion in almost five years.
The survey, carried out by Pegasus Insight, found 87% of landlords were in the black in the second quarter of 2025, up from 84% in the previous quarter and just shy of the late-2020 peak. The share of landlords making a loss slipped from 7% to 5%, while the proportion breaking even held steady at 8%.
It marks a significant turnaround from 2023, when a cocktail of rising interest rates, higher maintenance costs and post-pandemic turbulence pushed profitability to a five-year low, with only 77% of landlords reporting gains.
For Louisa Sedgwick, Paragon’s managing director of mortgages, the latest figures confirm what she has been seeing in her own loan books. “Yields, a key determinant of profit, are at almost their highest levels in more than a decade,” she said. “The sector’s resilience and continued demand for good-quality, flexible housing mean that buy-to-let property remains an attractive asset.”
Still, the profits are not guaranteed. The research revealed a stark contrast between landlords with trouble-free tenants and those dealing with arrears, property damage or evictions. The latter group reported profits just 79% of the time, well below the national average.
Sedgwick sees a lesson in that. “The data suggests there may be a link between profitability and harmonious relationships between responsible landlords and respectful tenants,” she noted. “It’s not always plain sailing.”
Landlords also shoulder significant costs, with more than a fifth of gross rental income going towards running and maintaining their properties. For many, the profits are a reward for constant investment — not just in bricks and mortar, but in the quality of life for their tenants.
And with the market edging back towards its 2020 highs, the buy-to-let sector seems poised for a new chapter — one in which both returns and relationships could determine who thrives.