A survey has revealed that 44% of landlords are looking to sell properties as a challenging market takes its toll.
Octopus Choice, a P2P lending product, surveyed 1,000 landlords and found they are divided over the future of the buy-to-let market.
Despite two in five respondents saying they are looking to sell, 56% of investors taking part said they want to keep or buy more rental properties.
For those looking to exit the market, falling yields and tax changes are the most common reasons.
Meanwhile, two thirds of landlords said property management has become a burden and 61% undervalued the costs involved.
Octopus Choice reports that London landlords are facing the toughest choice on whether to sell up or stay in the market.
It calculates that a typical buy-to-let property in London costs landlords over £1,250 per year for the first five years. This means an average London property worth £475,000 would need to be sold for £590,000 eight years later for the landlord to break even.
Some three quarters of landlords taking part in the study said they think investing in buy-to-let in the capital will be less worthwhile in five years' time.
On the other hand, Octopus says landlords in Scotland (8.8%) and the East Midlands (8.2%) are currently enjoying some of the best returns over an eight-year period.
Millennial landlords - those born after 1980 - are revealed to be more inclined to sell up, with 65% saying they are planning to sell one or more of their properties. This figure dips to just 29% among the over-55s.
"Brits still have an incessant love affair with bricks and mortar – but the hassle and cost of buy-to-let is a source of growing frustration, and some landlords may find that their once reliable day-to-day income is becoming harder and harder to come by," says Sam Handfield-Jones, head of Octopus Choice.
"But this isn’t the case across all parts of the market, with money still to be made from the right property in the right region."