UK estate and letting agents are heading into what many see as a defining year, with rising costs, tightening regulation and economic uncertainty threatening to squeeze profitability across the sector.
The Alto 2026 Agency Trends Report, based on a survey of 250 estate and lettings professionals, exposes mounting anxiety as the industry confronts weaker transaction volumes, higher overheads and major legislative reform.
Nearly two-thirds (63%) of agents identify economic uncertainty as their biggest challenge in the year ahead, closely followed by rising operational costs (60%) and an escalating compliance burden (also 60%).
Regulation is seen as the most immediate flashpoint. The vast majority of respondents (79%) say the Renters’ Rights Bill is their single biggest concern, with half worried about the tightening of EPC and energy-efficiency standards and more than a third (36%) citing the spread of local licensing schemes.
INTENSIFYING COMPETITION
Anti-money laundering rules, recruitment pressures and intensifying competition from online and hybrid players add further pressure.
The report depicts a sector under strain at every level: smaller independents are focused primarily on survival as margins erode; mid-sized firms are struggling with staff burnout, process bottlenecks and productivity; and larger groups face the challenge of managing compliance at scale while maintaining growth.
A clear top-ten list of concerns emerges for 2026: economic uncertainty; rising costs; compliance and regulation; lead generation and conversion; competition from online and hybrid agents; recruitment and retention; the Renters’ Rights Bill; EPC requirements; local licensing schemes and AML compliance.
EFFICIENCY THROUGH TECHNOLOGY
Yet the research also highlights how agents plan to respond. Almost two-thirds (63%) say their leading growth strategy is driving efficiency through technology.
Agencies are looking to automate administration, streamline compliance processes and defend revenue in a market where fees face downward pressure and consumer expectations continue to rise.
With margins already tight and reform accelerating, 2026 is widely viewed as a pivotal year that will test business models across the UK agency landscape.
UNDER SIEGE
Riccardo Iannucci-Dawson (main picture), CEO of Alto, says: “Agents are under siege from every direction, from inflation and insurance hikes to new laws and landlord losses.
“The Renters’ Rights Bill is the most significant shake-up of the rental sector in a generation and will test many independents.
“At Alto, we’re already building new tools that make compliance simple and seamless, from bulk conversion of fixed-term to periodic tenancies, to automated rent-review alerts and updated legal templates.
“Our goal is to take the admin and uncertainty out of reform so agents can stay compliant, protect income, and focus on delivering a great experience for landlords and tenants.”
EMBRACE AUTOMATION
And he adds: “The message from agents is clear: efficiency is survival. Agencies that automate and modernise – using AI to eliminate manual tasks and stop sales and lettings opportunities slipping through the cracks – can reduce risk, manage compliance more easily, and focus on what really matters: sales, growth and client service.
“These results show that those who embrace automation can turn compliance into a genuine competitive edge.”
Download the report HERE.
