Landlords looking to sell as buy to let market shifts

Landlords looking to sell as buy to let market shifts

9:30 AM, 12th April 2024, About a month ago 5

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The UK’s buy to let market is experiencing a period of change, with nearly one in three landlords looking to sell up in the next 12 months, research reveals.

The findings from uSwitch also highlight that the average loan value for BTL property purchases is on the rise.

In March 2024, the figure reached nearly £158,500, representing a 6% increase from the month before.

When it comes to remortgaging buy to let properties, uSwitch says that individuals aged 40-49 emerged as the biggest borrowers in 2023-24.

This age group secured slightly larger loans (£152,963) compared to those aged 50-59 (£151,621).

PRS is currently the UK’s second-largest housing tenure

The firm’s Claire Flynn said: “The private rental sector (PRS) is currently the UK’s second-largest housing tenure, consisting of roughly 4.6 million UK households – or 20% of the total.

“It’s estimated that PRS supply will have to increase by 227,000 homes a year over the next decade, to meet the forecasted demand for 1.8 million new households by 2032.”

She adds: “In 2023, there were around 83,400 buy to let mortgages authorised by UK lenders – less than half the number from 2022 when there were over 187,000 approvals.

“Approval numbers for buy to let mortgages peaked in 2016, at just less than 240,000, before dropping down to about 179,000 in 2020.

“The latest numbers for 2023 represent their lowest total since before 2012.”

However, approvals are predicted to rise this year, reaching nearly 168,000 – a rise of more than 100% from 2023 – but they will decline every year until 2032.

Highest average buy to let loan value

The study also reveals that London continues to be the region with the highest average buy to let loan value.

The average loan for a new investment property purchase in the capital hit £272,052 last month – that’s 30% higher than any other region in the UK.

Also, last year saw lenders approve more than 83,000 buy to let mortgages, making up 7.5% of all mortgage lending that year.

The total value of BTL mortgages reached £4.7 billion – a 10% increase from the previous quarter but a significant 57% drop compared to the same period in 2022.

The report highlights Lloyds as the leading player in the UK mortgage market, holding nearly 17% of the industry share.

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Fed Up Landlord

11:09 AM, 12th April 2024, About a month ago

You think it's bad now. Wait until Sneer Charmer and AngleOnA "Two Homes" Rebatener get in. The Dynamic "do what I say- not what I do" Duo.

The PRS will be decimated even more than it is now.

Mr Blueberry

22:26 PM, 12th April 2024, About a month ago

It seems the Government and their aligned charities are confident that there will be no PRS sell-off, and if there is, the slack will be taken up by new leasehold ownership. In short, both major political parties believe either way is better than the existing private rental sector in its present form.

Oddly, what percentage of landlords are indeed 'rogues' has never been established. Still, it is probably not unsimilar to that of 'rogue' tenants who don't pay the rent and damage property.

Statistics indicate a slowdown of PRS activity is not producing any real alternative to fill the gap of much-needed new rental homes, such as new government-sponsored home building or build-to-rent. Both have failed miserably.

The tipping point for a significant landlord sell-off inevitably comes with one or both of the following: the decrease in rental income vs the increase in alternative investments. Secondly, it is almost certain landlords will sell should the introduction of the Renters Reform Bill lack any sensible and expeditious appeal service for genuinely good landlords. Having a Renters Charter with no reciprocal Landlord Charter invites landlords to sell off in disgust at the unfairness of it all, and those hardened landlords that remain will no doubt defend what they believe is right with more legal cases clogging up the Courts even further than they already are.


8:34 AM, 13th April 2024, About a month ago

What seems to have been overlooked is the fact that all this has been tried before. I'm not talking about far back either.
Ireland introduced similar measures to what the government of today is and has proposed. This has seen queues of 100 plus people to view 1 house in Dublin. I hear there's tax changes now there that favour landlords to tempt them back to the market.
In New Zealand, they have introduced pretty much identical measures to what we have and are going to. Loss of section 21 and the equivalent of section 24 tax. I read a report yesterday that New Zealand's government are now reversing these changes after rents have rose by 170 NZD per week on average.
Both of those countries are more than similar to ours with people who share more than a bit in common with us.
So, I wonder why our leaders think they will be able to make it work here when history and evidence prove it hasn't worked anywhere else. Once they and successive governments have realised and made changes back it will be a long, long time before any investors put their trust in the system.
I keep hearing the saying "a private rented sector that works for all". The more pressing issue would be finding a political system that works for all, because the one we have isn't fit for purpose.

Dickie Withers

14:10 PM, 13th April 2024, About a month ago

I like this part, It’s estimated that PRS supply will have to increase by 227,000 homes a year over the next decade, to meet the forecasted demand for 1.8 million new households by 2032.” It has been reported that the Governments very own house building target which has now been dropped because it can not be met. Will not provide enough housing for the population already here. So the only thing that will happen and already is that hedge funds and foreign companies/ governments will build/ buy and speculate in the PRS. Charging way more rent which the Government will still have to massively subside, thus increasing Taxes on those working/dead/ property, to pay share holders dividends. Also they will looby said Government to their advantage because they have the leverage and influence. These companies will not except making a loss or tiny profit.

Dickie Withers

14:22 PM, 13th April 2024, About a month ago

Reply to the comment left by Liam at 13/04/2024 - 08:34
Unfortunately it will take them way to long to roll back any decisions that already gain the Treasury money and is not a latest fad on tick tock or X. It will take successive Government changes maybe 3 to 4 before things change and the Government truly is believable and committed to change for the good of it's people.

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