Previous estimates that half a million landlords are set to sell up may actually be a massive under-estimate, a property industry figure suggests.
Jonathan Rolande says the real figure is likely to be far higher – and warned the situation is going to massively drive rents up further.
Rolande – a representative of the National Association of Property Buyers – says: “There are currently around six million privately rented homes in the UK. It is being forecast that around 100,000 will quit the market every year between now and 2028. But I fear this may well be an underestimate. A larger number will be long gone by then.”
He gives a series of reasons why the figure is big and getting bigger.
“One factor is rent. They are currently rising at potentially unsustainable levels. Secondly, EPC changes, that may require expensive works to reduce emissions, are leading to many exiting the sector as well. Tax changes, particularly for portfolios held in a Limited Company, are also a factor, as is the growing adverse public opinion about landlords. Increasing maintenance and repair costs due to inflation” he lists.
And in addition to the much-hyped removal of Section 21 eviction powers from landlords he says high interest rates for saving will present a preferable and lower-hassle investment alternative.
He adds: “Many tenants currently happily living in their home will be forced to move out, even if, in the end, another landlord buys it.
“Rental homes, despite all of the negative press, provide valuable, temporary accommodation for millions of people who don’t want the long-term commitment of owning. Many younger people enjoy the flexibility of letting and can move from job to job and city to city with relative ease.
“Once hundreds of thousands of homes disappear to the owner-occupier market, choice will be more limited and rents will almost certainly rise.
“The impact is far reaching and, as is usually the case, the people who suffer the most from this will be the poorest, those already with the fewest choices. Perhaps the only reason to be optimistic is that the government may finally decide to use some of the windfall of Capital Gains Tax from these sales to put in the measures that will help everybody have access to an affordable and safe home. But time will tell.”
