Brokers say that more than a quarter of their landlord clients plan to sell properties as a result of the red tape, regulation and increased tax burden.
A survey on broker forum Cheery has revealed that 28 per cent of landlord clients are planning to sell properties, while 39 per cent of Buy to Let investors say they will increase rents. Just over a quarter of landlords plan to make no changes to their investment in the current climate and only three per cent intend to buy more properties.
Donna Hopton, director at cherry, comments: “Recent turbulence in the money markets has impacted all mortgage clients, but Buy to Let has arguably been hit hardest given the detrimental impact that higher rates have on stress testing and the loan sizes available to property investors.
“If you then consider the stream of regulatory and tax changes that landlords have had to deal with in recent years, combined with upcoming EPC requirements, it’s unsurprising that so many are choosing to sell properties. However, there are also millions of landlords who remain committed to the market, and it’s a market of continued demand from tenants and rising rents, so there will be plenty of opportunity for property investors.”
Mike Cook, chief mortgage officer at MFS, says: “Rising interest rates, new EPC rules and the introduction of various regulatory changes in the PRS over recent years has naturally caused some landlords to consider their options. However, we should be wary of overstating the declining appeal of BTL – with huge demand from renters and long-term capital growth on offer, residential properties will continue to attract interest from a wide range of investors.
“The challenge right now is for landlords, brokers and lenders to work together for the greater good. It starts with flexible and competitive products, whether that’s bridging finance or BTL mortgages. Brokers and lenders must provide landlords with access to the capital they need to purchase, renovate, refurbish and improve the EPC ratings on properties. This will ensure a buoyant rental market and help drive up standards. Further, by delivering choice and transparency, lenders can also help landlords navigate the dual challenges of base rate hikes and rising inflation.”
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Only 28% of landlords are selling, I think you'll find it's a lot more than that
Either way, it's a huge number and will devastate the PRS for tenants. The Gov't has a screw loose.
The government has more than one screw loose!
It will be interesting to see how many landlords sell. Saying you want to and actually doing it are two different things, especially in a falling market. Even harder when mortgage lenders are being more cautious than usual.
From my point of view I am desperate to get one tenant out. Notwithstanding the personal issues with them I want to get possession before S21 goes. I do not want to lose control of my property. I genuinely fear not ever being able to get it back otherwise regardless of the white paper saying landlords can get possession for genuine reasons.
I am going through S21 now. My solicitor didn't check everything properly so after 2 months I have to reissue it again. Then go through the rest of the process. It's not a good process atm and the usual levels of government incompetence can be trusted to make it all a whole lot more harder.
I am prepared to board up the property and leave it empty and wait for a better time to sell. I will put 'fake' occupants in the property to avoid any adverse interference of policy makers like the council too.
I am being forced to sell due to retaliatory eviction laws running rings around me at present, upcoming EPC issues as well as rental reform.
2 sold and in the bag; 1 completes next week and another on the market. Yes - its a pain - but I am definitely doing it!
Jo. Our fourth house sale nearing completion and another two just gone on the market - all within the last 6 months. We have definitely had enough. Heartbreaking for our lovely tenants though. Relieved to find that 3 families did managed to find alternative rental accommodation within 4 weeks.
Landlords will sell if the business is no longer viewed as a viable one. That is common sense. It is what happened in the past when the Rent Acts were in force. People either attempted to let outside the legislation or they sold their properties irrespective of the sale price. Some people gifted multi-flat houses to their children to convert back to single dwellings.
EPC is a very big issue, and again may result in landlords having no real choice, but to sell.
Francis, so very very sorry to see you sell up but its understandable with the constant attack by Rogue Regulators and Ministers, now I see a report S21 has as been confirmed to go to make it even more unfair for landlords.
Of Course its all about making room for the Big Boys build to Rent to take over, that’s what Johnson Government and his mates are all about.
The support for the BTR sector isn't something that Johnson instigated, it was Osborne. There were some very 'interesting' facts surrounding the 3 pronged attack he imposed with S24, CGT and SDLT.
I agree with John on this Michael, Osbourne was and his legacy is the problem here.
Personally I would have preferred Johnson to have stayed in office. The Tory backstabbers are the ones that need to go.
Michael, your sympathy is very much appreciated, thank you. It certainly has been a huge decision.
I completely understand your decision and like you I am concerned over the welfare of my tenants. I see letting a house as a partnership although weighted in my favour. These charities like Shelter etc don't seem to understand this, despite surveys saying that most tenants get on with their private Landlord.
As for the Governments policies, it is really concerning to me. If they don't understand this housing issue, then what else have they messed up!!
I believe more Landlord's will sell up completely or reduce their portfolio, after all some of us aren't getting any younger.
I am not so convinced the falling house prices will be a deterrent, yes they will fall but not compared to the last 18 months rise.
Already lenders are dropping their rates and I think early in the New Year those wishing to get a mortgage will have even better rates to choose from. Yes the base rate will still go up, but the lenders over-reacted and will bring their rates down.
I'm sure some will disagree with me and they could well be right, but this is my opinion.
I am referring to residential rates in the main, as I keep an eye on this as I am selling.
Developers will build less to help support prices.
Mortgage rates are coming down.
Whilst I am a forced seller due to all of my issues I am not financially and will leave one property empty perhaps for years if need be.
The population is always growing so demand continues to increase.
Mortgage terms are getting longer like Japan.
Some of the big developers also have to deal with Gove and are having to reclad buildings due to fire issues so they will have to divert resources away from new houses.
Where can we put our money? In the bank and let inflation erode it, or hold an asset where demand is set to increase.
Easymoney offer 6% interest on larger amounts, £200K +
Wow
I'm selling my portfolio when I can too but the present ban in Scotland means I can't sell unless I can prove 'financial hardship' Quote: " where a private landlord needs to sell due to financial hardship (private sector only)". This lasts until March 23 with the possibility of another 2 x 6months bans. Unbelievable!
So....I do all the graft, take all the risks and the Scottish government then take full control of my 'investment' and I've just got to accept it!
If I wasn't planning to sell the whole portfolio quickly before, I certainly am now! I was going to do it one per year but now I just want rid. I feel sorry for my tenants but I don't really have a choice. Let the Scottish government house them.
Andy, I know George Osborne was a disaster with his Polices and tamp Duty hiked especially for landlords. Then went off to be Editor of Evening Standard, guess what you are not finished with him yet he is coming back to Politics again so expect more. I don’t buy this Johnson Government mularkey he presided over all those anti-landlord Regulation’s tell me one thing this Tory Government did to to help the PRS, nothing everything they did was a cost at a hit to landlords property. There intention is to get rid of us to make room for their B2R mates to take over. Further evidence today when iHowz landlord Association said the void created by Landlords leaving will be filled by B2R is that not clear enough for you, what happened to us was deliberate. All chums from Oxford, Cambridge, Eton, Harrow and Harvard etc.
Banks closing down so they wanted another money stream, ours ready made or course ideal. All the others lined up too, John Lewis, M & S, L & G , Aviva, come on now when were they ever involved in Private Residential lettings and Government changing letting rules for them they can have fixed term Contracts .
The BTR lot can have fixed term tenancies?
Hope not
Shane. That’s ridiculous locked if you are not in Financial hardship in other words you need to be broke before you are allowed to get out. Why are they making laws based on your monetary position, what about your well-being, your mental health driven distraction with unjust laws.
Michael, it’s all about the tenant. Landlords are not people and they have no rights especially over their own property. Haven’t you heard???
Landlords use solicitors ( the most expensive option ) who don't always get things right, as Nick Van Hoogstraaten above has discovered.
I am most surprised at their lack of attention to detail. Therefore how judges may assess cases is questionable. Hence rental reform horrifies me in how are they going to determine whether a landlord can have their property back. If S21 isn’t as straight forward as it should be then what they hell are these politicians going to introduce???
I thought I chose my solicitor well with lots of good recommendations online but I think I’ve made a mistake.
How right you are I campaigned from ‘78 to ‘88 to have it introduced. The very foundation of all private lettings where was Sheltered and Co or Araj then. Landlords don’t stand up and be counted there’s enough of us, they hide behind the bush just take what ever concession someone might achieve. Section 21 was onerous enough certainty no walk in the park and difficult at best of times, at least you could get it back imagine what its going to be like now.
I have a tough enough time atm. I don’t want to imagine about any future of PRS. It is the stuff of nightmares!
Sadly i like the look of the hassle free 6% mentioned above. I don’t have much ambition with this government around and even less with Labour…
I think we all feel the same. It is a hopeless situation.
At least we have all got each other.
Romantic Nick!
🥰🥰🥰
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