0:04 AM, 12th October 2023, About A year ago 14
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One-in-four landlords are planning to sell a property in the next 12 months as they face rising costs, tax increases and new legislation that could affect their business, a survey reveals.
The Simply Business Landlord Report 2023, which surveyed almost 1,500 landlords in August, shows that the buy to let market is facing several challenges that could force many landlords to exit the sector.
The key reason for selling is the prospect of the Renters (Reform) Bill which will scrap Section 21 evictions and make it easier for tenants to keep pets.
This was cited by 49% of those planning to sell.
The chief executive of Simply Business, Alan Thomas, said: “A combination of economic uncertainty, changing regulations, and rising costs means there’s no shortage of challenges facing the nation’s landlords in 2023.
“Landlords and tenants still need clarity from the government on the future of energy efficiency rules and more details about the Renters (Reform) Bill.
“Although the vast majority of landlords will welcome increased standards across the market, more details are needed so they can prepare for the biggest changes to tenancy law in a generation.”
He added: “Considering all this, it’s unsurprising that two-thirds of landlords are concerned about the future.
“That being said, the long-term stability offered by property ownership means that 50% still think buy to let is a good investment.”
Other reasons for landlords in the UK to sell up include rising interest rates and mortgage costs (43%), and tax increases (32%).
The report also found that almost one in 10 landlords have sold a property in the last 12 months.
The potential exodus of landlords from the rental market could have a negative impact on the supply and demand of rental properties, pushing up average rents, which are already at record highs, the report says.
According to Simply Business, more than two-fifths (42%) of landlords consider the rising cost of being a landlord as the single biggest threat to the buy to let market.
In fact, 31% have seen their monthly buy-to-let mortgage repayments increase in the last 12 months, with monthly repayments rising by £1,000 or more for 5% of landlords.
As a result, almost half (47%) of landlords have increased their tenants’ rent, while only 4% have lowered them.
The report also reveals how landlords feel about the Renters (Reform) Bill, which is expected to bring significant changes to the private rented sector (PRS).
The bill has been welcomed by many tenant groups and campaigners, who argue that it will improve the security and quality of renting.
However, many landlords are concerned about the implications of the bill for their business and their rights as property owners and the survey reveals:
C-cider
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Sign Up10:00 AM, 12th October 2023, About A year ago
It might be 1 in 4 at the moment. As more fixed rate mortgages end and the full horror of the house price crash start to unfold, there’ll be many more (whether by choice or repossession by the lenders). Labour’s plans for housing will fuel the fire sale.
dismayed landlord
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Sign Up10:20 AM, 12th October 2023, About A year ago
Agreed. Bad enough getting worse press than child sex offenders but now I risk being accused of shortening peoples lives. We will be murderers next. Lol🤣🤣🤣
Ian Narbeth
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Sign Up11:21 AM, 12th October 2023, About A year ago
And Angela Rayner, shadow housing secretary fatuously says “We’ve got a countless amount of landlords at the moment. There’s plenty of them around.”
I will take her at her word that she can't count. All politicians, especially those who have even a basic understanding of economics, who support the wretched Renters Reforms Bill ought to be asking themselves what they are doing. If things are getting this bad at the prospect of the Bill, imagine how bad it will be when the Bill becomes law?
Reluctant Landlord
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Sign Up11:44 AM, 12th October 2023, About A year ago
Reply to the comment left by Ian Narbeth at 12/10/2023 - 11:21
well I guess we will know soon enough. If this does get to statute, my bundle of pre drafted S21's will be going out first class post very soon after....
that's 20 tenants being told to leave purely as a result of government action.....
C-cider
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Sign Up14:22 PM, 12th October 2023, About A year ago
Reply to the comment left by Ian Narbeth at 12/10/2023 - 11:21
We have plenty of landlords, too many wannabe tenants and far too many millionaire politicians that are not worthy of holding public office.
Private tenants pay premium rents yet are not afforded the same security of tenure as social housing tenants. Something needs to change.
Ian Narbeth
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Sign Up15:22 PM, 12th October 2023, About A year ago
Reply to the comment left by C-cider at 12/10/2023 - 14:22The changes wrought over the past 8 years and those proposed by the RRB have made and will make things worse.
If landlords were guaranteed speedy justice (i.e. a few weeks not many months) to evict defaulting tenants many problems would go away. Because there are too few properties to meet the demand, Government (with many in the Civil Service doing the dirty work) has deliberately made life difficult for landlords and has done nothing to help them.
That has led to some landlords withdrawing their properties, which in turn will mean tenants chasing fewer properties leading, as you rightly observe to premium rents.
I do not understand your comment about "plenty" of landlords. Would you rather there were fewer landlords?
Reluctant Landlord
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Sign Up16:15 PM, 12th October 2023, About A year ago
Reply to the comment left by C-cider at 12/10/2023 - 14:22Noone has ever yet (to my mind) actually determined...
Is it actually the number of landlords that is the issue here, or the number of properties available to privately rent? Is it too high or too few? Is it the location of where properties are need the issue? Are the types/sizes of accommodation provided not sufficent for need or something entirely differently? What is the crux of the issue really?
A landlord could be one person who owns 100 properties, or it could be one hundred LL's who own one property each. Is it more politically acceptable/socailly digestable that each of these LL's is replaced by a corporate? or is it all simply down at the end of the day the sheer lack of accomodation nationwide that is the issue.
Policitians of all flavours seem to focus on the lack of housing, and campaign groups about the cost to renters. So it is clearly about supply and demand.
Nothing more obvious than that.
It is irrelevant WHO owns the rental property.
Sunak & Starmer are yet to explain how, by making it even harder for the PRS to function, it is going to help current supply issues NOW?
Lisa008
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Sign Up9:19 AM, 14th October 2023, About A year ago
If a landlord sold up, I'm not sure many tenants would be in a position to be able to buy (even if they wanted to). Many landlords will sell onto another landlord, so that keeps the place in the rental stock. The issue is purely supply and demand. Family sizes are shrinking. You have more single people now than a generation ago. More divorces now - causing units to split. 1 or 2 bed units are what the UK are going to need more of over the coming years as more people are single and childfree. The bigger houses of 4+ rooms - there is less demand for. And even living in a shared house, (and splitting the bills to save costs) has become harder for many because in many places you now need a hmo license! This puts people off. So much red tape and regulation. It all just adds to the housing costs.
GlanACC
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Sign Up19:03 PM, 14th October 2023, About A year ago
I am one of those, as each tenant gives notice I will sell - 12 sold so far, 6 to go.
Shinh
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Sign Up22:14 PM, 14th October 2023, About A year ago
The actual no of btl properties avaliable or in play remains constant only the no of btl landlords is reducing.
There is no mass migration of btls properties to first time buyers affordability is hindering this.
Not sure what the media drama is about! Click bait.