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Amateur landlords are ‘beating a fast retreat’ and ‘becoming an anachronism’

A two-speed market has emerged in the buy-to-let sector as smaller landlords have stopped adding to their portfolios, according to Octane Capital.

The property finance firm reports that landlords are becoming more professional as amateurs turn away from the buy-to-let market.

The changing regulatory and fiscal environment has unsurprisingly had an adverse impact on the market, leaving some landlords with little choice but to reappraise the viability of their property portfolios, as reflected by a drop in amateur buy-to-let landlords acquiring homes.


But it is not all doom and gloom in the private rented sector. While fewer small-scale landlords are adding new homes to their stock, experienced landlords still remain active in the market.

“Amateur landlords are beating a fast retreat,” said Jonathan Samuels, CEO of the property lender, Octane Capital. “While professional landlords and institutional investors remain active, amateur landlords are fast becoming an anachronism.”

Samuels points out that the buy-to-let market is currently dominated by remortgaging activity, as reflected by the latest UK Finance Mortgage Trends data and ONS English Housing Survey.

“What activity there is within buy-to-let is primarily the remortgaging of existing portfolios or properties in order to maintain some kind of margin,” he added.

While the number of people living in the private rented sector has continued to grow, the crackdown on landlords has forced average rents upwards.

Samuels continued: “What’s particularly eye-opening is the significantly higher percentage of joint income that privately renting households spend on their rent compared to people paying a mortgage.

“Rents have risen astronomically in recent years while cheap borrowing costs have made mortgage payments exceptionally competitive.

“Given that homeowners are more likely to be in higher income groups than renting households, that's a fundamental disconnect.”

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    This article appears to perpetuate the myth that small landlords are necessarily 'amateur', which is often linked with being 'bad' landlords.
    My portfolio may be only 3 houses, but they are well run with satisfied and happy tenants. The are also not highly leveraged.
    There are many examples of large landlords not providing a proper service to their tenants.
    Small landlords are an important part of the housing mix, and should be regarded as such.


    And I expect that you really do own your properties as I do, these large landlords don't own their properties, the banks do, '' flash with on cast'' comes to mind.


    Spot on there Matthew.
    I have a mixture of commercial and residential and I go out of my way to ensure that everyone is happy, even being available 365 days of the year with a fast response to any problem.
    I constantly see articles in my local newspaper regarding Housing Associations leaving tenants in properties with rising damp for lengthy periods.
    If I did this in my area, I would be reported to Rent (not so) Smart Wales, with a likelihood that I would loose my licence.
    However, these rules don't apply to Housing Associations, so they can ignore any problem.
    Much needed repairs will go unactioned until it is highlighted in the press, many months (and even years) after the initial complaint was made to them by the tenant.

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    yes we are only amateur in the sense that it is not necessarily our main source of income. I also have 3 properties and I ensure that my tenants are dealt with in a "professional" manner. There is no reason for us to be discriminated against as appears to be happening. If ANY landlord falls short of the standards required they should be dealt with accordingly regardless of whether they are "Amateur" or "Professional". i fail to see how hammering small landlords provides any additional housing which is surely the root of these issues.

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    I find this sort of arrogant article deeply resentful and insulting. Running a house is a simple matter for most people. It is one of the things that nearly everyone knows how to do and if they don't they soon learn because a park bench in winter is not much fun. Currently we have rafts of regulation which say we must employ a, "Professional" to fix a door knob. Professionals are well educated skilled people who don't earn a living fixing door knobs. The only big risks are gas and electricity with water a close third. I am sick of my letting agent going on about these professionals. I am just as qualified as any one of them and that includes gas, electricity and water, decorating cleaning, carpets, aerials, fences etc yet I am still an amateur landlord. The only one of the above that I baulk at is gas because I know how dangerous it can be and I don't want the liability. I am trained in high pressure gas handling and appliances in laboratories.


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