Landlords' confidence takes a wobble
Tuesday 24th July 2012
A ‘private rental sector health check’ by online self-service letting agent Upad has revealed a drop in confidence among landlords.
Of the 500 landlords asked whether they were more confident or less confident about the buy-to-let market, 63% said they were confident – compared with 73% in April.
James Davis, head of Upad, said this could be attributed to various factors such as the availability of rental stock, tenant inability to pay rent, LHA benefit cuts and difficulty getting sensible mortgages.
Davis said: “The UK private rental sector overall has continued to perform well, hence why the majority remain confident, but that doesn’t mean that there aren’t areas for concern.”
He said that the rental market outside London had slowed.
He said: “The Consumer Credit Counselling Service, for example, reported a 55% increase in the number of calls they receive from tenants unable to pay their rent, and around half of these callers claim unemployment as their reason for being unable to pay rent. This issue of affordability tends to be more focused outside the London market.
“As well as this, LHA cuts have made it unaffordable to rent to those on benefits, while the number of specialist buy-to-let mortgage products have declined.”
One landlord replied to the survey saying: “I am less confident this month. We have ten properties as far north as Cumbria and we are clinging on to our tenants in these areas.
“Most are on housing benefit and we have to wait for payments now more so than ever –some are struggling and we are not getting the full rent each month. However, by contrast, we have six properties in the London area and these have always been easy lets. We seldom have any issues here.”
Another landlord commented: “I registered as less confident because wages are stagnant or reducing, living costs are high, and tenants are negotiating rents down wherever possible.
“There are also fewer investment mortgage deals in the market than there were in 2007, making it much tougher for landlords to find the right deal.”
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