We’re not talking about a revolution here; more of a modest but noticeable change. The private rented sector is not brimming with young professionals by any stretch. Nearly two-thirds of landlords are still aged 55 or over, according to the English Private Landlord Survey. And most still hold their property as an individual, not a limited company (though this is changing).

That’s the situation now, but future growth is more likely to come from younger landlords. They’re the ones most likely to expand their portfolios, according to our own research with over 600 landlords.

BM Solutions found that a third of our buy-to-let borrowers under 40 planned to increase their portfolios over the following year, compared with just 5% of those aged over 70. Younger landlords were also twice as likely to have added properties during the previous year than 60-69-year-olds, while some older investors were beginning to reduce their portfolios. Of the under-40s, only 2% had fewer properties now than a year ago, compared to 11% of 60-69-year-olds, suggesting a move to exit the sector from some older landlords.

Within the younger group is a small cohort of professional landlords considering new-build properties. It isn’t a drastic shift, but it’s an option that brokers may come across, and the reasons behind it are worth understanding.

The appeal is easy to understand. New builds usually offer better energy performance, lower maintenance and the protection of a 10-year structural warranty. A home that’s ready to let can provide a less time-consuming investment, with fewer unexpected costs or work that needs doing, so tenants can move in straight away to a home with a new boiler, plumbing and electrics. An added bonus is that it’s also freshly decorated.

An older property may come with a lower purchase price and greater scope to add value through refurbishment. That still appeals to many landlords, especially if they have the knowledge, time and contacts to manage the work. Others don’t have those skills or just want something more straightforward.

No rental property is ever going to be completely hands-off, of course. Landlords are responsible for managing the home, meeting legal obligations and dealing with problems when they arise. But buying new can cut the amount of work and uncertainty involved during the early years of ownership.

That’s attractive to some younger professional landlords who are building portfolios alongside careers and families.

Energy performance is another part of the appeal of buying a new home to let out.

The Home Builders Federation’s Watt a Save research found that 87% of new-build homes achieved an EPC rating of A or B, compared with just 5% of older properties. It also calculated that new homes cost occupants £420 less a year in energy bills.

Lower bills and a warmer, more comfortable home are more attractive to tenants and less likely to suffer from damp and mould problems.

For landlords, buying a home that already has a strong EPC rating cuts or eliminates the need for extensive retrofitting work to meet future energy-efficiency standards.

With Minimum Energy Efficiency Standards still expected to tighten to a C rating for rental properties by 2030, that offers a huge advantage to new builds and a large caveat around buying low-rated rental properties.

There’s a glaring sticking point with the appeal of new-build buy-to-let. The price.

New homes usually carry a premium over similarly sized older properties in the same area. At a time when mortgage rates, tax and rising operating costs are putting pressure on landlord margins, a higher purchase price is likely to reduce yield.

Frankly, it might not even be possible for some landlords. The numbers won’t always stack up on new build in terms of rental affordability calculations, so this is clearly not a strategy for every landlord or in every part of the country.

But it shouldn’t be dismissed either, because the local figures can tell a different story. Zoopla research published in 2024 found 30 local authority areas where a three-bedroom new build was cheaper than a comparable resale home, with the best savings in the South East and South West of England.

Winchester offered the best value for a new-build home, with the average three-bed costing £118,500 (22%) less than a resale counterpart. In Coventry, a three-bed new build cost £36,200 (15%) less than older homes, and in East Lindsey, the difference was £26,000.

New build can make financial sense for some landlords in some places, but the purchase price and yield are not the only things to consider.

Landlords need to think about achievable rent, tenant demand, mortgage costs, service charges, likely maintenance and how long they plan to keep the property. They should also weigh the cost and disruption of improving an older home against any premium attached to buying new.

This is where brokers can add value. You know your local market and can help landlord clients understand the bigger picture.

New-build buy-to-let obviously won’t suit every client. But for landlords looking for a more energy-efficient property, fewer immediate maintenance demands and greater certainty over costs, it could well make sense.

For the use of mortgage intermediaries and other professionals only

The information contained in this article is the property of Lloyds Banking Group plc and may not be reused or publicised without our prior permission. The information provided is intended to be for information only and is not intended to be relied upon. This information is correct as of October 2026. If you do not have professional experience, you should not rely on the information contained in this communication. If you are a professional and you reproduce any part of the information contained in this communication, to be used with or to advise private clients, you must ensure it conforms to the Financial Conduct Authority’s advising and selling rules.

BM Solutions is a division of Bank of Scotland plc. Registered in Scotland No. SC327000. Registered Office: The Mound, Edinburgh EH1 1YZ. Bank of Scotland plc is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority under registration number 169628.