There has been a sharp rise in the number of landlords in Manchester offloading buy-to-let properties at auction due to tougher licensing in the city.
With more stringent rules in place, designed to improve property standards, a number of landlords are now opting to reduce the size of their property portfolio, or exit the market altogether. This has led to the growing interest in selling rental stock under the hammer, according to Andy Thompson, a senior valuer at SDL Auctions North West.
Thompson makes specific reference to the new selective licensing scheme in Moss Side and Rusholme which will see around 1,200 private sector homes in the two areas become subject to mandatory conditions before a licence to rent is issued by Manchester City Council.
These conditions include up-to-date gas and electric safety certificates, safe electrical appliances, fitted and working smoke detectors, written tenancy agreements, references for prospective tenants, and potential specific conditions from the city council to improve specific issues.
Thompson commented: “This project means landlords can be fined for not applying or obtaining a licence in these areas, and the council then carries out checks to make sure they are fulfilling requirements.
“Our experience is that many landlords either can’t afford to make the improvements required or haven’t got the time to go through what are quite strict procedures, and so they are increasingly turning to auctions for a quick sale and exit.”
He added: “The next SDL Auctions North West auction in Manchester is on 12 December and this is an ideal date for any landlords who decide not to take part in the new licensing scheme.
“What’s also important to note is that properties can be sold with tenants in place so any landlords who aren’t put off by the licencing changes can also take on these properties and add them into their existing portfolio.
“Our auctions are a straightforward process with the exchange of contracts taking place in weeks rather than the months it can take via estate agency sales, and so they are ideal for landlords looking for a quick exit.”
“There’s a buoyant market here in the north west and, with strong, competitive interest from would-be buyers, the seller can often achieve the best price for their property by selling in the auction room.”