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TODAY'S OTHER NEWS

Landlord searches for letting agents increases by a fifth

Buy-to-let remains an attractive asset class with more property investors looking to take advantage of a notable increase in demand for rental homes, the latest figures from letting agent comparison website Rentround suggests. 

Since the chancellor announced an immediate stamp duty holiday earlier this month, landlord searches on the platform has increased by 21%. 

The data collected from Rentround indicates that some buyers are readying themselves to place newly purchased properties on the rental market, or simply planning ahead of a potential property acquisition with a view to letting it out. 

Raj Dosanjh, founder at Rentround, commented: “The stamp duty holiday has brought a flood of positivity across the property market.

“The increase in the number of comparisons run on our platform indicates landlords are looking to add to their portfolios, or that a new wave of landlords are looking to enter the market.”

The increase in letting agent searches is spread across the country. But there are pockets of significant increases. Manchester comparisons increased by 31%, followed by East London which had a 27% increase.

Dosanjh added: “Traffic on the site increased prior to Rishi Sunak's announcement, based upon rumours that the holiday may apply to the buy-to-let sector. 

“From the 8th of July, when it was confirmed that the holiday applied wider than first time buyers, the number of letting agent comparisons conducted increased dramatically.” 

  • Mark Wilson

    Flooding the market (as the market alludes) will surely lead to an over supply - leading to lower rents and lower yields. Add to this that the tenants to fill these properties wont have jobs or their wages will have fallen, I am not so sure gearing up to speculate on BTL is such a winner. Add to that the potential problem in obtaining possession and this feels like an increase in risk.

    Maybe BTL needs a wealth warning?

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    Who are 'Rentround' who gave these search results? Has anyone ever heard of them? Does a 21% increase in searches justify a comment like 'flood of positivity'? Anyway how would they know if someone searching is a landlord or not ?
    Best ignore this article. Sound like someone trying to talk up the property market. Look at actual property sales instead.
    As Mark (above) states, BTL always needs a wealth warning. If one is risk-averse, forget BTL, buy NSI savings instead. It also needs a health warning - dealings with certain tenants, contractors, complaining neighbours (and also letting agents too) can be very stressful. Definitely not for everyone. Not for anyone who wants an easy life.

    Rajdeep Dosanjh

    Hi, I'm founder of Rentround.com. To answer some of your questions, we're a letting agent comparison site for landlords. We show fees & services of agents in a landlords area, for free.

    The data in the article is based on appx 5,000 landlords that use our site to run a comparison each month. We only cater and promote towards landlords, hence the references to landlord data points.

    I hope that helps clarify some of your above points, happy to help more.

     
  • Paul Barrett

    Don't normally agree with ANYTHING mark states but on this occasion he is bang on and I totally agree with what he states.

    CV19 has proven what a flakey business model BTL is.

    Unless you can obtain RGI or you have HB tenants then BTL is VERY risky.

    BTL is great when the economy is going gangbusters.
    It will be at least 10 years before that might occur.

    Many leveraged LL will finally realise that leverage to expand isn't such a good idea in difficult times.

    Sensible LL will retrench and get by on fewer less leveraged properties.
    It would be wise for every LL to leverage to as much as HB would cover borrowings.
    Even though not a nice thought if you have to use HB tenants at least you know the HB should pay most of the costs.
    This CV19 crisis and consequent Govt penal actions against LL has proven how flakey the BTL proposition can be.

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    But Paul, you are forgetting something, generally HB falls quite a bit short of the rent, then when it is paid to the tenant will they pass it on to the LL, or if it is paid direct to the LL there is the risk of CLAW BACK sometimes yrs latter.

     
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    There is a lot of truth in the above comments. I haven't used an Agent for years until now because of regulations requirements impossible to cope with by on-line everything and to my loss. I am not a Digital Academic therefore cannot comply, it like everything has been taken away from me, so none of on line is anything to do with quality affordable Housing just re-inventing another way of doing administration so we can't do it although I never met a Digital Academic that could physically do anything that we have been for decades / Bull Sugar collapsing the World.
    Too many Letting Property or to my mind is it too much property to-let. I have had so many vacant even 4 recently & some still are while I pay the C/tax & this year increased by 3.9% Because Council said they need funds, so hit me again & no one to fund me. One example semi - Property Tenant
    couldn't pay full so paid half for 2 months, then went back to Home-land, then vacant 2 months before Agent found someone, so 2 half months = 1 month loss + 2 months vacant + Agents fee & hundreds of £'s VAT on the let cost more than a month rent, therefore 4 months loss = to one third of a year gone in the wind, really do you want me to tell you more but hit the LL, don't worry it will get worse just keep Building Thousands of Flats Clearly not required.

    Paul Barrett

    Your experience proves the situation that there are simply too many rental properties for demand that can be afforded by tenants.

     
  • Paul Barrett

    @andrewtownshend

    Yep totally agree with what you state here.

    What I was getting at is that LL would be wise to reduce leverage to that which can be afforded by HB.

    So HB for my property type is about £700.

    I would need to reduce leverage by more than 50% as I still must have sufficient rent to pay SC and GR.
    Plus of course an amount for S24 taxes and repairs for the year
    Thinking about it I might need to reduce leverage by more than 50%

    Of course as you mention all this doesn't include to hassle of actually getting your hands on the full contractual rent.
    It could mean I would need to reduce leverage to 25%.

    To achieve that I would need to sell at least 2 properties.
    But as it is my intention to get out of AST lettings I am not so fussed about letting.

    Indeed I have a flat still vacant from June 6th.
    Not going to house anyone on HB.
    As it's empty I am going to sell it unless someone pops up wanting to rent it for the full market rent.
    But my timeline is I want to be gone from the PRS no later than 3 years.

    But from an insurance perspective it makes sense LL leveraging to the amount that HB could afford if it came to as an emergency letting to HB tenants.

    HB is about as near as you can get to guaranteed rent though of course very mindful of all the difficulties that come with HB tenants.

    Mark Wilson

    Can't you see housing benefit being cut as a cash save for the Government? @paul, BTW Paul i am always bang! Have a good weekend.

     
  • Paul Barrett

    @markwilson

    Yes I would agree HB will be cut

    Not sure many LL can survive on HB

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    I could survive on HB, but I'm sure as hell not going to, on princible if nothing else.

     
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    @Rent round

    I see you do not work with absentee Landlords who require full management?
    I assume so as I cannot enter a non UK phone Number.

  • Rajdeep Dosanjh

    Hi David,

    Drop me a mail with your postcode and contact details & I'll send you the results: Raj@rentround.com

    Right now its only geared towards UK validation.

    Thanks.

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    How do I do that on here?

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