Strategies for Building a More Profitable Property Portfolio

Sun 30 November 2025 PaTMa

Want to start earning more from your property portfolio? Before making your next investment, pause and check that your existing portfolio is performing to its full potential.

Profitability is about more than just growing your portfolio and earning more rental income (although that’s important too!) It’s also about being strategic and efficient in the way you run your business - working smarter, not harder!

In this article, we’ll provide tips and advice that will help you increase your rental yield, reduce your operational costs, and manage your portfolio more efficiently to boost long-term profitability.

Review your portfolio’s current position

If you want to become more profitable, you first need to understand your portfolio’s current position.

You should always monitor your portfolio’s performance closely. Having a clear picture of how each property is doing will help you to make smarter, data-driven business decisions.

Begin by carrying out an in-depth review of your portfolio’s performance to identify the areas that offer the most potential for improving profitability.

As a starting point, we recommend working out the following key metrics:

Buy-to-let gross yield vs. net yield
Each property’s ROI.
Cash flow per property.
Void rate.
Long-term capital growth.
Tenant turnover rate.
Maintenance spend per property.

Our article ‘How to check if your property portfolio is really performing’ will guide you through the process of assessing your portfolio’s performance.

Once you’ve identified the areas of your business where there’s room for improvement and your highest and lowest performing properties, you can begin to form an effective plan to boost profitability.

Begin by cutting your operational costs

One of the simplest ways to become more profitable is to spend less. Lowering your outgoings is a quick way to boost your margins.

It may seem like a chore, but making a point of regularly comparing prices for the services you’re paying for ensures that you’re always getting the most competitive deal available. Even small savings can soon add up across a portfolio.

Schedule an annual review of your operational costs, or compare prices in the run-up to their renewal dates. Key expenses to review include mortgages, letting agent fees, contractors, insurance, and utility and broadband suppliers if you offer tenants all-inclusive rent.

Reduce your tax liability

Tax management may be boring, but minimising your tax bill is an effective way of boosting your portfolio’s overall profitability – and let’s face it, no one wants to be paying the taxman more than is absolutely necessary.

The best way to make sure your business is set up to be tax-efficient is to speak to an accountant. If you haven’t yet, arrange a meeting with an accountant to find out how you can reduce your tax bill.

Some common strategies for reducing your tax liability as a landlord include:

Make sure you’re claiming all allowable expenses: Make sure you know which expenses can be deducted from your rental income before tax is calculated. Allowable expenses include letting agent fees, insurance, accountant fees, repairs and maintenance (but not improvements), mileage, safety certificates, and more.
Keep track of mileage, home office, and professional expenses: These expenses can be easily overlooked or forgotten if you don’t have a system in place to keep track of them. Make a habit of keeping all receipts and invoices in one place so you don’t miss out on claiming anything.
Consider incorporation: Speak to an accountant to find out whether it would be more tax efficient to hold your properties within a limited company.
Keep digital financial records: If you haven’t already, sign up for an all-in-one tool like PaTMa Property Manager to streamline your bookkeeping, reduce errors, and prepare for Making Tax Digital (MTD) in April 2026.

Maximise your existing rental income

Don’t expand your portfolio until you’re sure that you’re making the most of what you already have. Making a few strategic upgrades to your properties could help justify higher rent, reduce costly void periods, and increase the rental income your portfolio generates.

Here are some avenues to explore when looking for ways to increase rental income:

Review whether you’re charging competitively: At least once a year, you should sit down and research what comparable rentals in the area are charging. If you’re charging below market rate, it may be time to increase rent.
Redecorate or replace furnishings/white goods: If your rental is starting to look a bit old and tired, a simple refresh can improve tenant satisfaction and justify a rent increase.
Make smart property renovations: Adding a new kitchen, bathroom, or en-suite to a property may be a big expense, but it can boost long-term capital growth while also helping you achieve higher rental income and demand in the short term.
Invest in better photography: Does your marketing photography do your property justice? Better photography can help to generate more interest and position your property at the higher end of the local price range.

When planning rent increases, don’t forget that the Renters’ Rights Act, set to come into effect during 2026, will restrict rent increases to once per year.

Tailor your property to meet market demands

Look for gaps in the rental market where demand is high and supply is low. If you can tailor your property to meet demand, you are likely to enjoy fewer void periods and higher rent.

Consider furnishing your property: Tenants are usually willing to pay more for the convenience of a fully furnished property. If furnished properties are in high demand, furnishing your property for students or young professionals may allow you to charge higher rent.
Tailor your property to a particular niche: Research the local market and look for niches where there is strong demand but low supply. For example, professional couples looking for high-quality furnished flats. Then tailor your property to tap into one of these markets, and you may be able to charge a premium.

Positioning your property to appeal to a particular type of tenant can increase its appeal and help boost rental income.

Sell underperforming properties

When you reviewed your portfolio’s performance, did you find any properties that are consistently underperforming? Underperforming properties tie up capital, drain time, and reduce your overall returns.

Signs of an underperforming property include:

ROI keeps falling.
Needs constant repairs.
Repeated void periods.

If you’ve explored avenues to boost the property’s performance to no avail, it could be time to say goodbye and look for new, more profitable opportunities.

Create a tenant retention strategy to reduce turnover

Have you considered how the cost of a high tenant turnover affects your rental income and overall profitability? Void periods and onboarding new tenants are both time-consuming and costly, so it makes sense to prioritise reducing tenant turnover.

If you don’t have one already, now is as good a time as any to create a tenant retention strategy to help you find high-quality tenants and keep them for longer.

A good tenant retention strategy should cover:

Screening for high-quality tenants: A thorough tenant screening process should be an essential part of every tenant retention strategy. Carrying out rigorous checks can help you find out whether tenants are reliable, trustworthy, and financially stable. It’s always a good idea to meet prospective tenants face-to-face as well; you’ll usually get a gut feeling about them.
Forging positive landlord/tenant relationships: Tenants are more likely to stay for longer if they have a good relationship with their landlord. Keeping communication lines open and gaining their trust by responding to and resolving issues promptly can help to create a positive relationship.
Maintaining the property to a high standard: Tenants are more likely to stay longer if they feel happy and comfortable in their home. Keeping up with routine maintenance jobs will improve their level of comfort, while also looking after your property’s value.
Adding value to your service: Being flexible with tenant requests and finding little ways to add value to your service will make it harder for tenants to leave. Consider allowing pets if your tenant would like one, or update furnishings or white goods when they start to look tired, without tenants having to ask.
Incentivise renewals: Make sure you’re on the ball about when your tenant’s contracts are up for renewal. Set yourself a reminder well ahead of the date to contact your tenant with an incentive for renewing, like one month of free or reduced rent.

Keeping good tenants happy is a simple way of maintaining steady and predictable rental income long-term, reducing void periods, and minimising the amount of time and money being spent on marketing the property and onboarding new tenants.

Grow your portfolio strategically

Once you’re confident that your existing properties are performing at their best, you can start thinking about reinvesting profits to grow your portfolio.

When searching for your next investment property, remember to invest strategically and avoid emotional buying based on your personal preferences. Instead, do your research and run the figures to ensure that you’re investing in a property that promises long-term profitability.

Before expanding your portfolio, always check that:

Market conditions are right: Evaluate economic conditions, including interest rates, rental demand, and local market performance. Don’t rush into an investment; bide your time until the conditions are right. Timing your purchase carefully could significantly improve your yield.
The property is in a high-growth area: A property’s location has a significant influence on its profitability. Look to invest in up-and-coming areas where there’s strong rental demand, good transport links, and regeneration plans to achieve the best rental yield and long-term capital growth.
The numbers look good: Always run your numbers carefully before investing. Work out how much you would expect to earn in rental income, what your operating and financing costs would be, and how much yield, ROI, and long-term capital growth you could expect to gain before making a decision.

Consider diversifying

When expanding your portfolio, consider diversifying into different property types, locations, and price points. While it can be tempting to invest in more of what you know or have previously had success with, diversifying can help to reduce risk by making your portfolio more resilient in the face of market fluctuations. Diversifying can boost your business’s overall profitability by helping you to access higher yields and providing a more stable income by reducing your reliance on a single market.

Use the PaTMa Deal Finder tool

PaTMa’s Deal Finder tool is fast and easy to use. It helps landlords to research potential property investments, work out a property’s potential ROI, and decide whether it’s a good fit for their portfolio.

Use landlord software like PaTMa to streamline management

One of the simplest but most effective ways to increase your profitability is to start running your portfolio more efficiently using a specialist property management tool like PaTMa Property Manager.

When you digitise and automate day-to-day tasks like bookkeeping, document management, tenant communication, and compliance tracking, you free up more time to focus on developing your business strategy and growing your portfolio.