Property consultancy Savills is warning that every landlord will soon be faced with the question – sell up or stay?

It suggests the straw that breaks the camel’s back may be the tightening up of Minimum Energy Efficiency Standards. 

In a market snapshot the consultancy says: “One key piece of legislation will be the requirement to upgrade the EPC rating of all privately rented homes to at least a C rating by 2030. Currently, only two fifths of privately rented homes meet this standard. 

“Some landlords will make these improvements, particularly those planning to be in the market for decades to come. But in some cases it won’t make financial sense: either the landlord is already planning to exit or the cost of upgrades will be prohibitive. In some markets the amount of money required to bring the property in line with anticipated regulation is likely to exceed an entire year’s rental income. 

“The choice to stick or twist is one all landlords will soon face.”

Savills also says that rents will carry on rising next year as supply still lags behind demand but warns that an ‘inflection point’ of affordability will soon kick in.

The agency reports: “RICS property market reports have continually reported a lack of new rented homes coming to the market – this is borne out by the latest snapshot of listings on the market, with the number of available rental listings per letting branch 16% below its 2018-19 level during September.

“High demand and low supply has been the influence behind the significant rental growth seen over the past few years. 

“And at a national level, this pattern looks set to continue into 2025, with rents expected to rise above incomes again. But there are signs in some markets, especially London, that affordability constraints are starting to outweigh the supply and demand imbalance.”