Specialist lender Somo has launched a new bridging product aimed at landlords seeking short-term stability as regulatory reform, higher borrowing costs and fiscal uncertainty reshape the private rented sector.
The Landlord’s Breathing Space Loan has been introduced as the Renters’ Rights Act 2025 comes into force in England this spring, representing one of the most significant overhauls of the rental market in decades.
A CHANGING LANDSCAPE FOR LANDLORDS
From May, landlords will face the abolition of Section 21 no-fault evictions, a shift to assured periodic tenancies, restrictions on rent in advance, tighter controls on rent increases and more stringent requirements around property standards and tenant protections.
These changes arrive at a time when buy-to-let interest rates remain elevated, maintenance and compliance costs are rising and many landlords are reassessing portfolio viability ahead of the Autumn Budget.
The combined effect has placed pressure on margins and rental yields, particularly for landlords managing larger portfolios or holding properties that require investment to meet new regulatory expectations.
PROVIDING TIME AND LIQUIDITY
Somo’s Breathing Space Loan is designed to offer short-term liquidity without monthly repayment obligations for up to 24 months, regardless of credit status.
Loan sizes range from £25,000 to £3 million, with decisions made on a credit-backed basis focused on the asset and the borrower’s circumstances rather than traditional credit scoring.
The product is intended to support a range of strategies, including clearing arrears, funding essential works, refurbishing properties or providing cashflow support while landlords plan a refinance or sale.
Jade Keval, sales director at Somo, said: “As the tenancy landscape changes dramatically, many landlords find themselves squeezed. Between rising costs, regulatory pressure and tighter yields.
“Our Breathing Space Loan gives them the time, flexibility and liquidity to stabilise, adapt and plan ahead, without panic or rushed decisions.”
The lender said the product has been designed to support brokers working with landlords facing short-term cashflow stress or those needing time to reposition assets in response to legislative and market change.
Additional pressure is expected from forthcoming tax changes, including a 2% increase in property income tax rates for landlords from April 2027 and the introduction of a high-value council tax surcharge on homes valued above £2 million.
Somo said the loan is now fully live and available for immediate deployment, offering brokers and landlords a flexible option to manage cashflow and adjust portfolios as the new regulatory and tax environment takes shape.
