12:01 AM, 21st August 2026, 40 seconds ago
Landlord confidence is growing as the number of landlords experiencing rent arrears falls to a record low, according to new data.
Research by Paragon Bank reveals the second quarter of 2026 saw 26% of landlords report experiencing rent arrears during the past 12 months. This was down by four percentage points from 30% in the first quarter of the year to mark the lowest level.
The bank also reports the buy-to-let sector remains resilient despite ongoing market uncertainty.
Overwhelming majority of tenancies work well
According to the data, alongside record-low arrears, 86% of landlords reported making a profit from their lettings activity, up by two percentage points on the previous quarter, while Paragon’s latest rental yields analysis found average gross rental yields reached 7.02% during the second quarter of the year.
Lisa Steele, mortgage lending director at Paragon Bank, said: “We often hear about the pressures facing landlords, whether that’s economic uncertainty, regulatory change or the wider costs associated with running and maintaining properties. What’s sometimes overlooked is that the overwhelming majority of tenancies work well and continue to provide reliable income for landlords.
“Record-low arrears, strong levels of profitability and healthy rental yields are all signs of a sector that continues to demonstrate resilience despite a challenging backdrop.”
Landlords report profitable businesses
Ms Steele added: “It’s understandable that landlords remain cautious about factors such as the wider economy and future market conditions. However, when they look at the performance of their own portfolios, the picture is generally much more positive.
“Most tenants continue to meet their rental commitments, most landlords report operating profitable businesses and those are the factors that have the greatest influence on day-to-day confidence.”
The figures come as UK Finance reports that buy-to-let mortgages in three months or more arrears have declined for nine consecutive quarters.
At the end of Q2, they accounted for just 0.52% of outstanding buy-to-let mortgages, down from 0.68% at the same point last year.