Beyond the yields: Stress-testing buy to let portfolios in the current climate

Roger Morris, Group Distribution Director at Chetwood Bank for ModaMortgages and CHL Mortgages

For most of my many years in the industry, buy to let performance has been judged by one number: yield. Capital growth has influenced strategy at times, but yield has long been the default measure of health – if rent covers the mortgage and costs, the investment works.

Today, that metric tells only part of the story.

A new landscape for landlords

Recent years have tested even experienced landlords. Higher interest rates have pushed up borrowing costs, inflation has lifted maintenance and management expenses, tax changes have reduced net returns, and the upcoming Renters’ Rights Act will reshape landlord responsibilities.

On top of that, the push for higher energy efficiency adds new financial and operational pressure, particularly for multi‑property landlords.

Buy to let has simply become more complex. Opportunities remain, but the threshold for long‑term sustainability is higher.

Why yield isn’t enough

Yield assumes stability: fixed rents, predictable costs, steady rates. That’s not today’s reality.

A property showing a 6% gross yield may look strong, but refinancing at higher rates, void periods, maintenance spikes, tax shifts or EPC upgrades can quickly erode returns.

This is why we take a portfolio‑wide approach, stress‑testing cashflows under different scenarios so landlords and brokers can make decisions that stand up to changing conditions.

The broker’s role: partnership, not just process

This environment elevates the role of brokers. Landlords need advisers who can help them look ahead, not just secure a product. And brokers need clarity and straight answers from lenders so they can speak confidently to their clients.

Sometimes that means revisiting leverage, exploring product flexibility, or structuring finance with future pressures in mind. The goal is resilience, not boundary‑pushing.

This transparent, collaborative approach builds trust. Brokers who can demonstrate that finance is not only competitive but robust as well, will stand out. And lenders who’re easy to work with will earn brokers’ loyalty.

Moving forward

The buy to let market is evolving fast. Yield still matters, but on its own, it no longer defines portfolio performance. A broader, more forward‑looking view is essential and how lenders and brokers respond will shape long‑term success.

About CHL Mortgages

CHL Mortgages supports a wide range of landlord needs, giving brokers a powerful toolkit for the cases other lenders avoid. Our flexible, common‑sense criteria put you at an advantage – from layered ownership structures and directors’ or intercompany loans, to day one remortgages and blended ICR assessments that help overcome affordability challenges.

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Complex trading structures slowing you down?

We accept any SPV SIC code – from simple SPVs to full trading companies – letting you place deals other lenders won’t even consider.

Got a non‑standard property on your desk?

Send it our way. We consider large HMOs, over‑adapted HMOs, hybrid MUFBs with HMO elements, and studio flats under 30m².

Delivered with transparent processes and strong service, CHL Mortgages helps brokers place the quirky, layered and complex cases that others can’t.

When the case gets complicated… CHL Mortgages is built to say yes.

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