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TODAY'S OTHER NEWS

New batch of landlords preparing to sell, warns leading agency

The research head of Knight Frank is warning that a new batch of landlords are preparing to sell up and leave the private rental sector.

Tom Bill of Knight Frank issues the waning in a market snapshot looking specifically at prime postcodes in London.

“Several months ahead of a general election, there are early signs that more landlords are considering a sale. The number of new lettings instructions across London was 4% lower in April compared to the same month last year, Knight Frank data shows” he says. 

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“Meanwhile, sales instructions were up by 16% over the same period. With prices either flat or falling across many prime London sales markets, these properties may revert to the lettings market if the asking price is not achieved.”

The agency says rental value growth in prime London postcodes has narrowed to levels last seen in the summer of 2021. 

Average rents in prime central London (PCL) grew by 4.9% in the year to April, while the figure was 4.4% in prime outer London (POL). The increases may be down but are still relatively high by historical standards, as the chart shows.

It is largely the result of rising supply. 

Knight Frank explains that an active sales market during the pandemic, particularly throughout a 14-month stamp duty holiday from July 2020, meant lettings stock fell as owners capitalised on buoyant conditions by selling. 

On top of that, landlords have also been leaving the sector in recent years due to proliferating red tape and tax. Those who haven’t sold up typically have preferred shorter tenancy lengths to leave themselves the flexibility to do so. While that is good news for tenants, the fact rental value growth has calmed down over the last six months is potentially another disincentive for landlords.

The Renters Reform Bill currently going through Parliament is adding to the mood of uncertainty. Any proposed changes by the Conservative Party could be expanded upon by Labour if they win power. 

Overall, lettings supply has grown in recent years, and new instructions were 11% higher over the first four months of this year than the same period two years ago, a time when rents were growing by over 20%. As a result, tenants are increasingly pushing back against the sort of large rent increases that have been common since then, either by re-negotiating or leaving at the end of the tenancy.

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    Landlords preparing to sell because of the RRB? Colour me shocked! 😂😂😂

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    Section 24 is making me seriously consider selling one or two of my more recently purchased properties. The ones where I haven't owned them long enough for the CGT to be too horrific.
    I don't especially want to sell. I still like being a landlord. I'm not in favour of the RRB but I'm not completely terrified. I think it's far more damaging to tenants than politicians or activists have realised yet.

    Section 24 coupled with much higher mortgage payments just doesn't work. Increasing rents simply doesn't cover the extra interest and extra tax especially when it pushes the turnover into the 60% tax band. The fact that we can't manipulate our adjusted income by contributing to a SIPP like everyone else can makes it especially painful.

    Getting out  Landlord

    You're right Jo . Basic maths. It does not add up.

     
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    My surprise factor is in the stratosphere 🚀 🤔🤔🤔

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    From experience in the Rent Act days, there is only a very small percentage of landlords who will let on the basis that tenants will have lifetime tenancies. Landlords will either opt for short lets or sell their properties - as Knight Frank has found out, too.

  • Nic  Kaz

    I’m one selling/sold up. Last let completes in October and I gave my tenants the heads-up last month to give them as much notice as possible - because I am not the bogeyman landlord of widespread opinion. If they find somewhere else early I will release them and get it sold. I expect them to choose to stay to the last minute though as I’m charging below market rate - another bogeyman fail. I also offered to sell to them at a significant discount (it’s a c rated two bed mid terrace, in demand so will sell easily). This alas isn’t an option for them. I really hope the government knows what they are doing….

     G romit

    The Government knows exactly what it's doing - following the WEF plan. Unfortunately that doesn't include doing anything to help tenants or Landlords (in fact, it does the opposite).

     
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    They haven't got a clue about what they are doing Nic neither have they thought through to the end game where Tenants are homeless.

     G romit

    ....that presupposes that they give a flying f**k about tenants (or Landlords) which they don't!

     
  • Sarah Fox-Moore

    Shocker ❗ Another swathe of landlords rushing for the Exit.....all by design.

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    The sad thing is the silly lefties haven’t thought things through with all the landlord bashing. The PRS will cease to exist and the Corporates will bat them off.

     G romit

    ... that's the plan!

     
  • Fed Up Landlord

    The fine upstanding lefty socialists against the nasty right wing extreme corrupt and crooked demonic capitalist landlords......

    The picture has been painted, the story has been told, socialism streets are paved with gold....

    Tenants good, landlords bad, when they're gone we will all be glad....

    " Property is theft"- it leaves the "comrades" bereft, it's not mean to be green, it's our right to be kept....

    This is the reality of how we landlords are being depicted in the media for a common end. Our extinction.

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    I seem to remember that all the recent anti-landlord legislation and tax changes were implemented by a Tory government. I'm neither socialist nor left wing, but just sayin'.
    It's not a simple right versus left issue.
    I now have only 2 let properties left, and am considering the future for these.....

     
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    As well as S.24 many more are going to require licenses this is a huge cost whether its Selective £750. up to £1650 for Mandatory this is the tip of the iceberg with the thousands of Compliance costs + the fire Assessment £220.00 it cost me. Even to do one Tenancy Agreement now you need 12 documents and 10 are annual renewals that’s a big cost + remedial’s.
    Bills through the roof including water the companies in charge couldn’t run a tap.
    Regulator gave them a huge fine the laugh of the century it doesn’t affect them at all, they have got into £54b debt since privatisation, no problem they have announced they are putting up their charges 16% a big laugh.

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    Our Landlord Association or Paul Shamplina is offering 5 ⭐️one day Coursese how to be a landlord for £99.00 good idea I suppose so I won’t knock it.
    It goes to show as if any evidence was required the massive damage they have done to us, on the other hand I have been doing it for 46 years but now I must learn how to do it. They invented ways to make me like a fool and can no longer cope I can’t think of a better way to drive us out, just because Computers were invented and digital academics were born the root cause of everything but no hope of any of them doing an actual day’s work.
    So none of this is anything to do with quality affordable housing.

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    Perhaps we could offer courses to the NRLA on how to be a good Landlord Representative?

     
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    Just wondered is Knight Frank the same Company that used to be called Mr Square 🔲 Foot, all those years ago.

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    If only landlords had an Association that represented them? One with a voice that Government actually listened to.

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    Now there’s an idea. They could call it something like the Residential Landlords Association.

    Oh wait, we had one of those until Bungling Boy Beadle took it over. 🤔

     
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