One in four UK landlords plan to sell properties this year – HMRC

HMRC has revealed that 24% of UK landlords plan to sell part of their rental property holdings within the next year, with this figure rising to 33% over the next five years.

In its study, HMRC also found that 53% of landlords have no intention of selling their properties in the same period.

The research will provide the tax body with fresh insights into landlord investment strategies, property ownership patterns and tax management practices.

Portfolio landlords will sell

The HMRC report states: “Landlords who owned one property mostly intended to keep their portfolio the same in the next 12 months (80%), compared with 48% of landlords who owned 11 or more properties.

“The more properties landlords owned, the more likely they were to change their portfolio over the next 12 months, mostly to reduce it.”

It goes on: “For example, among landlords who owned 11 or more properties, 15% intended to increase the number of properties they rented out, while 35% aimed to reduce the number (compared to 2% and 16% among those who owned one property).

“Landlords were also asked to think ahead to the next five years.

“One-third (33%) said they intended to reduce the number of properties they rented out over this period, while 8% intended to increase the number and 53% expected it to stay the same.”

Most are single property landlords

HMRC found that 93% of landlords own properties individually, while only 7% operate through a company and 5% through partnerships.

Most own unfurnished residential properties (72%), followed by furnished ones (26%).

More than half (55%) own a single property, with an average of three properties per landlord.

The South East (22%) and London (16%) host the highest number of properties, though landlords in Scotland and the North East own slightly more on average, at four properties each.

Financially, 63% of landlords earn less than £20,000 in gross rental income annually, with 52% making less than £10,000 in profit.

Bought for investment

Investment motivations differ significantly with 60% of landlords acquiring properties as investments and 40% initially purchasing them for personal use, inheritance or as gifts.

Both groups value properties for their long-term financial stability (71% of investors, 67% of non-investors) and as tangible assets (69% and 64% respectively).

Qualitative findings underscored optimism in the housing market, with landlords expecting rising house and rent prices to boost profits over time, offsetting the costs of renting out properties.

For 78% of landlords, rental income is a supplementary revenue source, while 19% rely on it as their primary income.

Landlord tax is an issue

HMRC says that tax management remains a challenge for many landlords and though many understand basic tax obligations, 49% hire accountants due to the time-intensive nature of self-filing and frequent changes in tax regulations.

However, 43% handle their taxes independently.

Of those filing their own taxes, 62% find it manageable, as do 68% of those using agents.

Despite this, 40% of landlords point to complex or unclear rules as a barrier, followed by 19% noting a lack of expertise and 12% pointing to the workload.

Also, 63% of landlords employ intermediaries like estate or letting agents to manage their rental operations.

If you would like to discuss quickly selling your rental property with experts, contact Landlord Sales Agency:

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