Given the economic uncertainties around trade policies and their impact on the markets, might this be a good time to add more real estate to your investment portfolio?
Only if you do it very thoughtfully.
One of the ways I stay grounded in a broader view of economic and policy trends is by reading The Times of London. Often, what happens in the U.K. arrives in the U.S. a few quarters later.
One such indicator came from a story a few weeks ago. According to the National Residential Landlords Association, a third of British landlords now earn less than £10,000 (roughly $13,500) from their rental properties. Twenty-six percent sold part of their portfolios last year. Another 20 percent say they plan to exit in the next 12 months.
The main drivers are tightening tax policy, growing regulation, and declining margins. These are similar to pressures that are building across the American rental market.
In the U.S., landlords face rising interest costs, reduced affordability for buyers and renters alike, and policy uncertainty that compounds investment risk. Short-term rental restrictions are expanding in some markets, while rent control proposals have gained traction in others. Natural disasters have contributed to dramatic increases in insurance costs.
Meanwhile, the cost of remodeling and maintenance continues to rise, driven in part by tariff whiplash on imported materials and persistent supply chain volatility. Increasingly, even the stability of legal protections is in question, as national disputes over the rule of law cast uncertainty on long-established landlord-tenant frameworks.
These forces are colliding with a more cautious consumer. Inflation may be slowing, but it has already reset tenant expectations. Many renters are staying put rather than upgrading to newer or larger units. Incomes are flat in real terms. Retail and tech layoffs, combined with post-pandemic cuts in office leasing, have hit local employment in secondary markets. As discretionary budgets shrink, rental demand is shifting toward value, not features.
In short, landlords are absorbing higher costs with limited ability to increase prices. That’s a losing formula.
The U.S. version of this trend is already visible, though not yet as pronounced. Investor sales are rising in high-regulation markets. Inventory is slowly returning to owner-occupants. In many cities, large institutional buyers are pausing acquisitions, leaving smaller landlords with few exit options and little leverage.
It’s worth remembering that roughly half of the U.S. rental housing stock is owned by individuals with one or two properties. These are not corporate landlords. They are retirees with a duplex, couples who held onto a starter home, or families investing for supplemental income. The populist framing of landlords as heartless entities misses this entirely. For many of these owners, rent checks cover the property’s mortgage, repairs, and little else. When costs rise or vacancies stretch, they feel it personally.
The question is no longer whether rental housing is viable. It’s whether the terms have changed enough to make long-term ownership unattractive for individual investors.
Before you start looking for rental properties, here are some factors to consider: You will need to thoroughly research your local laws as well as rental market conditions and trends. You will need to budget for volatility. You will need to view tenants as cost-sensitive partners, not just revenue sources. You will need the ability to make decisions from a Self-led position, grounded in clarity about risks, returns, and time horizons.
As someone who has, over decades, built financial independence through owning rental property, I know first-hand the sometimes painful ups and downs of being a landlord. It is an investment path to take only with care, a long-term perspective, and full awareness of the risks.