Research by Foundation Homes Loans has revealed that 38% of UK landlords said they had reviewed the size of their portfolios to ensure they could withstand any creeping costs.

Some 7% have sold properties to either reduce portfolio sizes or diversify.

This figure rises to 19% for those holding 20 properties or more, with the PRA policy change edging closer.

Almost a third of landlords (30%) admitted to increasing their rental prices, with the largest proportion to do so in the East Midlands (41%) as landlords recognised the popularity of the region for professionals seeking the balance of space alongside proximity to London.

The East Midlands had the highest proportion of landlords reviewing the size of their portfolios (50%), while landlords operating in central and outer London followed closely behind at 45% and 40% respectively.

•   Precise outlines portfolio landlord lending approach
•   Accord introduces new mortgages for landlords range
•   East of England rents rise almost four times the UK average

Significantly, almost a quarter (24%) of landlords operating in central and outer London raised their rent prices, which will increase the pressure on those still hoping to afford home ownership.

Almost three-quarters of landlords (71%) said they had experienced a drop in confidence, more so for those operating in central (78%) and outer London (77%), reflecting the cooling London market and decreasing tenant demand.

“Landlords have been met with a raft of changes, from stamp duty charges to shifts in tax policy, and the lack of certainty on the political front has clouded the picture somewhat,” said Jeff Knight, marketing director at Foundation Home Loans.

“The response has been to ‘batten down the hatches’, streamlining larger portfolios and protecting income by increasing rents – decisions that can be reviewed once the buy-to-let market is more accommodating.

“The fact remains that – whether it’s as a stepping stone to home ownership or a longer-term lifestyle decision for tenants – the rental sector is an increasingly important part of the housing mix.”