Exodus of private landlords ‘exaggerated’ – claim

Exodus of private landlords ‘exaggerated’ – claim

10:06 AM, 10th January 2023, About 2 weeks ago 32

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A survey has revealed that landlord confidence is ‘robust’, though many worry about the government’s meddling in the private rented sector (PRS) and want changes to capital gains tax allowances reversed.

The findings from property lending experts, Octane Capital, also highlight that landlords are concerned about the increasing day to day cost of their buy-to-let investment driven by the cost-of-living crisis.

The survey of 2,000 landlords also found just 8% of investors had reduced the size of their BTL portfolio over the last year.

‘The exodus of landlords from the rental sector’

Jonathan Samuels, the chief executive of Octane Capital, said: “It appears as though the exodus of landlords from the rental sector has been somewhat over exaggerated with just a small proportion opting to reduce the size of their portfolio in 2022.

“That said, while we’ve seen a degree of stability return following a shambolic mini-Budget last September, many buy-to-let investors remain cautious about the year ahead.”

He added: “This caution is likely to prevent them from investing further until a greater degree of certainty returns, although we must also tip our hats to the government in this respect, as their consistent attack on the sector remains the number one concern.”

Capital gains tax allowance changes reversed

Along with 41% of landlords who would like to see capital gains tax allowance changes reversed, 60% don’t believe that interest rate hikes have peaked.

Landlords also don’t believe the market will be more settled during 2023 and most say their biggest concern is the government’s legislative interventions.

Many also worry about the increasing running costs of buy-to-let investment such as energy bills and maintenance.

The day-to-day management also ranked as one of the biggest challenges facing landlords – and the increased cost of borrowing.

Increasing the size of their buy-to-let portfolio

As a result of their concerns, just 16% of landlords intend to increase the size of their buy-to-let portfolio over the coming year.

And when asked which government legislative change they would most like to see reversed, the recent changes to capital gains tax allowance ranked top.

The government plans to reduce the CGT tax-free allowance from £12,300 to £6,000 in April, with a further reduction to just £3,000 by 2024.

The ban on Section 21 evictions and potential improvements to EPC ratings also ranked highly among the changes landlords would most like to see reversed



Comments

Chris Bradley

10:33 AM, 10th January 2023, About 2 weeks ago

These results are based on 2000 landlords? Are they small portfolios, limited companies or larger full time landlords. What proportion of the rental market do those surveyed represent?.
If 8% have reduced their portfolio's what percentage of the rental market has gone? Did they leave because they were going to anyway or because of government intervention or landlord costs?
This survey for me is worthless and a waist of time and resorces

moneymanager

10:45 AM, 10th January 2023, About 2 weeks ago

What concerns me isn't the reduction of the CGT allowance per se, and especially not in the scheme of property disposals, but the implication that the government sees no value in value creation, no entreprenurs in a capitalist/communist state?

Robert

11:26 AM, 10th January 2023, About 2 weeks ago

This article is utter nonsense! LEXIT is very real for those of us working on the ground and not just doing surveys. Rents have rocketed - up 25% in my area. Theres your proof. Simple supply and demand economics.

Gromit

11:29 AM, 10th January 2023, About 2 weeks ago

Reply to the comment left by Chris Bradley at 10/01/2023 - 10:33
...and was the survey done amongst their Client base? OC specialises in certain types of Client who aren't necessarily representative of the whole of the PRS.

Large pinch of salt required here methinks!

Freda Blogs

11:54 AM, 10th January 2023, About 2 weeks ago

All these surveys regarding Landlord sentiment we see 'quoted' - invariably producing differing conclusions that the majority of us don't agree with.

Has anyone on here ever been consulted on any of them? Not me!

Rod

13:10 PM, 10th January 2023, About 2 weeks ago

I'm more inclined to put more faith in the latest Hometrack UK rental market report, where the first graph shows the growing gap between supply and demand.

Their second graph shows how headline rents for new tenancies used by the media and tenant groups ignore the lower levels charged to the 75% of tenants who do not move on a regular basis.

https://www.hometrack.com/latest-news/rental-market-reports/

Mr.A

13:19 PM, 10th January 2023, About 2 weeks ago

Another survey ?.
Company wanting some much needed exposure, has to say something contrary that will take the initial interest of the reader.
Totally different from what I know as Facts .(landlords selling up )
Anyway ,if there's already a housing shortage and then if some landlords reduce their portfolio by even a small amount, does that not make a bad situation even worse .

Crouchender

14:27 PM, 10th January 2023, About 2 weeks ago

Reply to the comment left by Rod at 10/01/2023 - 13:10
I am reletting (because couple split up) a 1 bed garden flat in London and 50% of the people who came to view the flat when I asked why they are moving they said it was because their LL is selling. This is very real.

I am getting very low 'churn' with my existing tenants as they know it costs a lot more to rent in the market compared to what they have.

The garden flat I relet for was set an asking price of 17% above old rent and went for 2% above asking price whist bidding between two couples! REALITY

The FACT is LLs are leaving the sector (so reducing supply) and demand is up (now people cant buy property). Rents will only go up unless the government do something to help the supply side. Which they won't and Labour will be worsen supply side even more as they don't want BTL investors have the opportunity to buy before FTBs! You can't mess with a free market like that.

DSR

17:47 PM, 10th January 2023, About 2 weeks ago

Lets do our own straw poll.

Hands up who's downsizing their portfolio?

Are you on your way to Lexit? (or should that even be better termed as Legs-it??)

What number of properties did you have and how many have you sold as a direct result (and any combo of) tax issues/IHT/GCT/anti LL legislation/up coming EPC proposals/loss of S21/other?

Out of 31 residential properties I've sold 7..with more to go.

Your turn!

Robert

18:02 PM, 10th January 2023, About 2 weeks ago

Reply to the comment left by DSR at 10/01/2023 - 17:47
Sold three - 4 left to go.

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