Landlords selling up in frustration – RightmoveMake Text Bigger
New Rightmove research indicates 24% of landlords are planning to sell at least one property from their current portfolio, 13% will be selling more than one and 11% report they wish to sell their entire portfolio. This is despite rents being at record levels having increased by 2% in the last year.
Rightmove figures show the number of properties available to tenants in the UK is now down 13% on the previous low recorded in the third quarter of 2015, and London is 24% down. The blame for this being largely apportioned to section 24 mortgage interest relief restrictions significantly increasing costs for landlords and the tenant fees ban.
Conversely 30% of Landlords still consider property to offer the best return on investment and are planning on expanding their portfolios.
Statistically the average landlord contained within the report owns and lets three properties and a quarter of landlord only own one property.
Miles Shipside, Rightmove commercial director and housing market analyst said:
“There are a number of forces at play in the current rental market, all leading to record rents for tenants and fewer homes to choose from, yet demand remains strong. There are signs that the stock shortage may worsen if some landlords follow through with their plans to sell up.”
“Worryingly for tenants there are signs that the stock shortage may worsen if some landlords follow through with their plans to sell up, though an increase in plans for build to rent properties may help to fill some of the gap. The overall feeling among those landlords who are planning to exit the market is one of frustration with many telling us that the tax changes mean it’s no longer financially attractive to keep their properties.
“Early data seems to point to some of the income lost through the removal of tenant fees being passed on to the tenant in higher rents, but it should still work out cheaper than paying the upfront admin fees as long as stock doesn’t constrict and rents don’t rise too much. What we really need now is more properties available to rent. Rising rents may tempt some landlords back in, but momentum is currently to downsize portfolios in spite of the prospect of increasing yields.”
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