Landlord Confidence Gets A Post-Election Boost

AFS Team·5 March 2020·4 min read
Landlord Confidence Gets A Post-Election Boost

Landlord Confidence Gets A Post-Election Boost

Confidence among landlords has been boosted after the election, a survey has revealed.

Despite regulatory and tax changes hitting landlord incomes in recent years, 24% of landlords say their prospects for 2020 will either be 'good' or 'very good'.

The survey was carried out by Paragon who found that in a previous survey just 9% of landlords in the third quarter of last year had the same optimism.

Indeed, of the five measures that are used for the survey, confidence rose in four of them for the last quarter of 2019, compared to the previous quarter.

Landlords expressed more confidence in their own letting business, at 31%, as well as in the wider UK private rental sector, for 16%.

Landlords are confident in capital gains

The survey also highlights that 23% of landlords are confident in capital gains but there's a slight dip in the number believing that rental yields will improve this year, with just 39% of landlords saying so.

The managing director of mortgages at Paragon, Richard Rowntree, said: "After declining optimism among landlords over several quarters, it is pleasing to see a recovery in confidence. This is still low compared to historic levels and a more certain economic and political landscape will provide, hopefully, a platform for growing confidence."

He said that while tenant demand remains strong, landlords will be looking to the government to allow tax and regulatory changes to 'bed in and deliver a period of consistency'.

Of the regions, landlords in the South West and the East Midlands are the most optimistic about the prospects for their letting business and they also expressed most confidence about yields.

However, the most optimistic are those landlords who have at least 11 properties in their portfolio and they expect better rental yields and a better performing financial market than those landlords with a smaller portfolio of properties do.

The best value cities for tenants revealed

Meanwhile, the worst and best value cities for tenants have been revealed.

The list of worst cities is dominated by locations in the south of England, but the best value city for tenants is Bradford, according to Adzuna, a job search engine.

In second place is Hull, followed by Carlisle and Derby.

The worst city for rental property is London, where 53% of a tenant's income will be spent on rent.

Indeed, nine out of the 10 worst value cities for tenants are found in the south.

The next worst destination is Brighton and Hove, followed by Oxford and then Bath and York.