Rise of the Gen Z landlord: Renting property one among hottest companies for under-28s

Being a landlord is one of the most popular businesses among Generation Z – despite many in that age group struggling to get on the property ladder themselves.

‘Letting and operating of own or leased real estate’ accounts for 4.7 per cent of businesses run by those aged 28 or under, according to analysis by specialist insurer Hiscox. 

This was based on analysis of Companies House registrations from the year 2025.  

A strategy for those trying to get on the property ladder in expensive areas of the country is to buy a property somewhere cheaper, rent it out, and use the income to build a deposit for their own home. 

If the value of the property went up in the meantime, they could also add those funds to their savings pot when they sold. 

Robin Edwards, property buying agent at estate agent Curetons, told Hiscox: ‘High property prices continue to make personal homeownership difficult, so many Gen Z investors see property investment as a different way to enter the market. 

‘Often these Gen Z investors rent and work in cities like London where it’s expensive to buy, so instead they invest in other regions of the UK with much cheaper property prices that offer better yields and more potential for capital growth.’

Playing the property market: Some younger people are purchasing a buy-to-let somewhere cheaper than where they live, to help them save money for their own home (stock image)

However, this scheme requires careful consideration – not least because, if someone has owned a property in the past, they lose the valuable stamp duty discount offered to first-time buyers. 

They also cannot claim the discount on their rental property, because the rules require that it must be their main residence. 

However, they could avoid paying the 5 per cent stamp duty surcharge most landlords pay, because this is only charged on ‘additional’ homes. 

First-time buyers pay no stamp duty on homes worth up to £300,000. It means that, a first-time buyer purchasing a £275,000 home would save £3,750 in taxes, compared to someone who already owns a home. 

The buy-to-let sector has been hammered by extra taxes and regulations in recent years, with the Renters’ Rights Act due to cause a further shake-up when it comes into force on 1 May. 

Anyone considering becoming a landlord will need to be on top of these rules, as the penalties for getting it wrong can be expensive. 

However, landlords remain optimistic about the sector’s money-making potential.

Separate research from Kensington Mortgages found 84 per cent of residential limited company landlords expect rental yields to increase over the next 12 months.

Hiscox found that there were 393,531 members of Generation Z listed as company directors on Companies House, a figure which was growing at a rate of 78 per cent on average each year. 

Some of this growth is due to the fact that someone can only become a company director aged 16, and that members of the younger cohort of Generation Z are still reaching that age every year. 

‘Retail sale via mail order’ was the type of business most likely to have a director born between 1997 and 2012, accounting for 5.6 per cent. 

This is probably because of the rise in ‘drop shipping,’ where businesses are set up to sell items online without ever owning the inventory themselves. 

Instead, the retailer forwards the order on to their supplier who ships the product directly to the customer.

This is popular with young entrepreneurs, with some posting about how they make money dropshipping on Tiktok.